Chapter 4 (2-15)

What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?

A family maintenance policy

Which of the following types of policies pays a benefit if the insured goes blind?

AD&D

A company that owns a life insurance policy on one of its key employees may do all of the following EXCEPT:

Change the policy's interest rate

Which of these characteristics is consistent with a Straight Life policy?

Owner can adjust both premium and death benefit

Which of the following is considered an element of a Variable Life Policy?

Underlying Equity Investment

Life insurance immediately creates an estate upon the death of an insured. Which of the following policies is characterized by a guaranteed minimum death benefit?

Variable Life

Variable Life products require a producer to:

hold a Life Insurance license and a Securities license

Whole Life insurance policies are contractually guaranteed to provide each of the following, EXCEPT:

partial withdrawal features beyond a surrender charge period

Additional coverage can eb added on a whole Life Policy by adding a(n):

Decreasing term rider

Which Type of policy is considered to be overfunded, as stated by IRS guidelines?

Modified Endowment Contract

J is issued a Life Insurance policy with a death benefit of $100,000. She pays $600 per year in premium for the first 5 years. The premium then increases to $900 per year in the sixth year, and remains level thereafter. The policy's death benefit also remains at $100,000. Which type of Life Insurance policy is this?

Modified Premium Life Insurance

What kind of life insurance product covers children under their parent's policy?

Term Rider

The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is:

The cost

What advantage does the renewability feature give to a term policy?

The insured may extend the coverage period

Which of the following needs and objective change, the policy owner can make adjustments to the premium and/or face amount.

Underlying equity investment

S, age 40, is looking to buy a Life Insurance policy that will allow for increases or decreases in coverage as his needs change. The policy best suited for S would be:

Universal Life

What type of life insurance incorporates flexible premiums and an adjustable death benefit?

Universal Life

Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?

Variable Life

Which policy requires an agent to register with the National Association of Securities Dealers (NASD)

Variable Life Insurance

S owns a life insurance policy with cash values that fluctuate according to the underlying investment performance of common stocks. Which of these policies does S own?

Variable whole Insurance

When is the face amount of a Whole Life policy paid?

When the insured dies or at the policy's maturity date, whichever happens first

A life insurance policy that provides a policyowner with cash value along with a level face amount is called:

Whole Life

Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?

Whole Life policy with an Other Insured Rider

If a 10-year Term Life policy contains a renewability provision, the policy will renew:

Without evidence of insurability

How long does the coverage normally remain on a limited-pay life policy?

age 100

All of the following are characteristics of an Adjustable Life Policy, Except:

Face Amount can be adjusted using policy dividend

All of these statements about Equity Indexed Life Insurance are correct, EXCEPT:

If the gain on the index goes beyond the policy's minimum rate of return, the cash value will mirror that of the index

Which of these needs is satisfied by Adjustable Life Insurance?

Insured's need for flexible premiums

D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?

Level term

Which of the following features of a group Term Life policy enables an individual to leave the group and continue his or her insurance without providing evidence of insurability?

Conversion privilege

A(n)___________ term life policy is normally used when covering an insured's mortgage balance.

Decreasing

J is issued a Life Insurance with a death benefit of $100,000. She pays a ^400 per year in premium for the first 5 years. The premium then increases to $900 per year in the sixth year, and remains level thereafter. The policy's death benefit al remains $100,000. Which type of Life insurance policy is this?

Modified Premium Life Policy

All of these insurance products require an agent to have proper FINRA securities registration in order to sell them, EXCEPT for:

Modified Whole Life

Which of the following actions is NOT possible with a Universal Life policy?

Premiums may be applied as a credit against income tax