Types of Policies - Insurance

Which of the following is NOT true regarding the accumulation period of an annuity?

It would not occur in a deferred annuity.

Which of the following is an example of a limited-pay life policy?

Life Paid-up at Age 65

Equity Indexed Annuities

Seek higher returns

An individual purchased a $100,000 Joint Life policy on himself and his wife. Eight years later, he died in an automobile accident. How much will his wife receive from the policy?

$100,000

Pure Death Protection

- if the insured dies during this term, the policy pays the death benefit to the beneficiary - if the policy is canceled or expires prior to the insured's death, nothing is payable at the end of the term - there is no cash value or other living benefits

To sell variable life insurance policies, an agent must receive all of the following EXCEPT

A SEC registration

What characteristic makes whole life permanent protection?

Coverage until death or age 100

whole life insurance

Insurance that is kept in force for a person's entire life and pays a benefit upon the person's death, whenever that may be.

Term Insurance

Is a temporary protection because it only provides coverage for a specific period of time. And also provides "pure death insurance".

Death Benefit

Is guaranteed and all remains level for life.

Why is an equity indexed annuity considered to be a fixed annuity?

It has a guaranteed minimum interest rate.

Which two terms are associated directly with the way an annuity is funded?

Single payment or periodic payment

Living Benefits

The policy owner can borrow against the cash value while the policy is in effect, or can receive the cash value when the policy is surrendered.

Which of the following statements is correct regarding a whole life policy?

The policy owner is entitled to policy loans

A man purchased a $90,000 annuity with a single premium, and began receiving payments 2 months after that. What type of annuity is it?

immediate

A return of premium term life policy is written as what type of term coverage?

increasing

Three types of term coverage

level, increasing, decreasing

A domestic insurer issuing variable contracts must establish one or more

separate accounts

All of the following statements about equity index annuities are correct EXCEPT:

the annuitant receives a fixed amount of return

Level Premium

the premium that does not change throughout the life of a policy