Life Insurance Polices
which whole life premium option would have the highest annual premium 10 , 20, or 30 pay
10 pay period the fewer the payments the greater each payment must be for the policy to mature
at what age does a whole life policy mature
100
A VL policy has a _____ premium in a cash value that is _______
A VL policy has a level premium in a cash value that is not guaranteed
A WL death benefit and premium both remained _______ for the life of the policy
A WL death benefit and premium both remained level for the life of the policy
which policy pays the death benefits and concludes or ends on the death of any insured party listed on the contract?
A joint life policy
a VL contract has a guaranteed minimum ___________
AVL contract has a guaranteed minimum death benefit
what is straight life or continuous premium life?
Additional ways to describe ordinary whole life
what happens at age 100?
Age 100 is the age at which many insurers calculate the policy's cash value as equal to its death benefit
what life insurance policy pays a benefit at the earlier of death or at the end of a specified period?
An endowment
Which life policy has cash value gains that mirror or are tied to a stock market index, such as the S&P 500?
An indexed life insurance policy
what is a lump sum premium?
Another name for single pay whole life
why is whole life insurance more expensive than term insurance?
Be'cause of the building up of cash value
decreasing term insurance has a _____ premium and a _______ death benefit.
Decreasing term insurance has a level premium and a decreasing death benefit.
what are my product has a guaranteed minimum return in opportunity for cash value growth based on the performance of a stock index?
Equity index whole life
true or false: Upon death, the cash value is payable in addition to the whole life death benefit
FALSE
true or false: a 20 year family maintenance income policy pays for five years if insured dies 15 years after policy issue.
False. Regardless of the date of death comma the policy will pay for 20 years since it uses level term insurance.
when converting policies, what must remain consistent?
Generally the death benefit must remain constant
what are the advantages of term insurance?
It is initially less expensive than whole life, it may offset debts comma and ensures insurability
what are loan option in cash surrender?
Methods available to the policy owner to obtain or access the policy's cash value
Premiums on a VL policy are _____
Premiums on a VL policy are fixed
What are the disadvantages of term insurance?
Temporary protection, no cash value, premiums increase with each renewal (Level term)
Term insurance is described as ____ protection
Term insurance is described as pure protection.
The death benefit of a term policy is payable only if death occurs during the __________ period.
The death benefit of a term policy is payable only if death occurs during the term Policy period.
who assumes that investment risk in a traditional insurance contract?
The insurance company
what does term insurance provide?
The maximum amount of protection with the lowest initial outlay of premiums
the premium on a universal life policy may be _____.
The premium on a universal life policy may be flexible.
true or false: a whole life policy never requires renewal.
True
what is an unbundled premium?
When a universal life policy owner receives an annual statement breaking down all the policy expenses and charges
whole life is a combination of term protection and _______.
Whole life is a combination of term policy in cash value.
can the death benefit of a variable life policy increase overtime?
Yes, assuming the underlying investments outperform expectations and increase in value.
does a variable life policy have a guaranteed minimum death benefit?
Yes. Regardless of account performance, the minimum debt benefit is paid typically the initial death benefit listed on the policy's face
a 10 year level premium policy provides coverage for____ years
a 10 year level premium policy provides coverage for 10 years
A 20 year endowment will mature at the end of ___ years.
a 20 year endowment will mature at the end of 20 years.
what policy combines whole life insurance and a decreasing term writer providing coverage on the breadwinner
a family income policy
name the policy that combines whole life insurance and a level term rider providing coverage on the breadwinner
a family maintenance plan
a 5 year level term policy will renew every 5 years Subject to
a five year level term policy will renew every five years subject to maximum age limitations.
A jumping juvenile policy has a death benefit that increases to ___ times its stated value with no premium increase
a jumping juvenile policy has a death benefit that increases to five times its stated value with no premium increase
a jumping juvenile policy may also be called ______________
a jumping juvenile policy may also be called juvenile life insurance
a level term policy has a ____death benefit and premiums will increase at the next ____period
a level term policy has a level death benefit and premiums will increase at the next renewal period.
what two licenses are required to sell variable products
a life insurance and FINRA license
describe a whole life policy
a policy providing death benefit protection for life or to the age 100, cash value, level death benefit, an level premium
Describe an adjustable life policy
a policy that offers the ability to change the death benefit based on a person's need
what non traditional life insurance policy has a flexible death benefit and a rate of return that is interest sensitive
a universal life policy
which life insurance policy has a cash value that is invested in securities and has the potential for greater growth
a variable life policy
a variable life policy has a ____ minimum death benefit, but the cash value is ________
a variable life policy has a guaranteed minimum death benefit, but the cash value is not guaranteed
what is single pay whole life
a whole life policy with a one-time premium in coverage provided until age 100 or death
what is a 10 pay whole life
a whole life policy with premiums paid for 10 years and coverage provided until age 100 or death
at what age is a whole life policy's cash value assumed to equal its death benefit
at age 100
cash value generally begins to build within a life policy sometime in the _____ year.
cash value generally begins to build within a life policy sometime in the third year.
cash value increases with every ______ payment after the ___ year
cash value increases with every premium payment after the third year
what is attained or actual age conversion
conversion or new policy premiums are based on a person's current age
name the ability to change from a term policy to a whole life policy without providing evidence of insurability
convertibility
how long will coverage be provided under a 10- pay whole life product
coverage will continue until death or age 100
what type of policy protects the bank in the event a borrower dies credit
credit life
______life insurance is purchased to protect a borrower if a lender dies and cannot repay a loan
credit life insurance is purchased to protect a borrower if a lender dies and cannot repay a loan
what is another name for interest sensitive whole life insurance
current assumption whole life
what type of insurance policy is most often used as a mortgage redemption policy
decreasing term insurance
decreasing term insurance has a ____ death benefit
decreasing term insurance has a decreasing death benefit
describe an endowment
endowments have heavy cash savings, intended for future uses such as retirement or college funding
______ pay a living benefit at end of a set timeframe or a death benefit should death occur during that time frame
endowments pay a living benefit at end of a set timeframe or a death benefit should get the card during that time frame
what life insurance policy uses dividends to purchase one year term insurance to supplement a reducing death benefit?
enhance ordinary or economatic life
true or false: term insurance builds cash value
false
false for how long will the premium on a 20 year level term policy remained level
for 20 years
generally, credit insurance uses _____ term.
generally, credit insurance uses decreasing term.
What whole life product has lower premiums that increase each year for the first three to five years of the policy
graded premium whole life
In a group credit policy the bank is both the _______ and the _____
in a group credit policy the bank is both the policy owner and the beneficiary
what is another name for a first to die policy
joint life
what whole life product has lower premiums for the first 3 to five years of the contract comma with a one time premium increase
modified premium whole life
most credit life policies utilize ______ term insurance and coverage may not exceed the ______________
most credit life policies utilize decreasing term insurance and coverage may not exceed the amount of the loan
does a term life policy have cash value
no term life is pure insurance
what are the two UL death benefit options
options A and options B
As a client ages what happens to her premium payments in a variable life policy
payments in a variable life policy remain level fixed
what age is used to determine level term policy renewals
premiums are based on a person's actual age comma and renewal premiums will increase
which whole life payment option would have the lowest overall premium over the policy life 10 pay 20 pay or single pay
single pay
straight life has a _____ and ____ premium
straight life has a predetermined and level premium
Which policy pays a death benefit, but only after the last remaining policy issued dies
survivorship life
what is another name for a second or last to die policy
survivorship life
which type of insurance provides temporary protection
term insurance
what is the renewability feature
the ability to renew a term policy without having to provide evidence of insurability
the cash value and potential death benefits of a VL policy vary _____
the cash value and potential death benefits of AVL policy vary daily
What is policy equity
the cash value in a whole life policy
the cash value of a whole life policy grows at a minimum interest rate of _% to __%
the cash value of a whole life policy grows at a minimum interest rate of 3% to 4%
What is predetermined in a whole life contract
the death benefit, cash values, premiums, nonforfeiture and surrender values
the death benefits and premium in a whole life contract are _____throughout the owner's lifetime
the death benefits and premium in a whole life contract are level throughout the owners lifetime
What is cash value
the equity that grows inside a permanent policy
what is the target premium
the initial premium established to fund a UL policy
Who is the owner of a juvenile insurance policy
the parent or legal Guardian
Describe a family policy
the policy provides whole life benefits on the breadwinner, with level term insurance on spouse independence
the premium on an annual renewable level term policy increases __________
the premium on an annual renewable level term policy increases each year.
true or false: a universal life policy allows for partial withdrawals of the cash value
true
true or false: regardless of cash value performance, VL policies have a guaranteed minimum death benefit
true
true or false: term insurance is temporary but whole life is permanent
true
true or false: a 20 year family income policy will pay for Seven years if insured dies 13 years after policy issue
true. The policy will pay the Seven years of remaining benefits as it uses decreasing term insurance
what is original age or retroactive conversion
type of conversion that uses the age of the original policy purchase.
Describe an equity index life policy
usually a universal life policy with cash value tie to an equity index account; offers a guaranteed minimum rate of return
Identify the acronym: VL
variable life
what policy combines variable life with flexible premiums
variable universal life
Whole life premium rates are based on a rate per _____ of coverage
whole life premium rates are based on a rate per $1000 of coverage
whole life premiums remain ____ for the life of the policy
whole life premiums remain level for the life of the policy