Life Insurance Policies

In adjustable life policy all of the following can be changed by the policy owner except?

The type of investment they can decrease the premium, changing the premium- painting period, increasing or decreasing the face amount of coverage, or changing the period of protection.

When an employee terminates coverage under a group insurance policy, coverage continues in force?

For 31 days.

Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement at age 65. What would be the right policy for this client?

Limited pay whole life

Which universal life option has a gradually increasing cash value and a level death benefit?

Option A

Which of the following statements about group life is correct?

The cost of coverage is based on the ratio of men and women in the group.

An adjustable life policyowner can change what policy feature?

The coverage period

What is not a characteristics of a group Life Insurance plan?

There is a requirement to prove insurability on the part of the participants

An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is this?

Limited- pay life

What is NOT considered when underwriting group insurance?

The insureds medical history

What would have an IRS required corridor or gap between the cash value and the death benefit?

Universal Life- Option A: if this corridor is not maintained, the policy is no longer defined as life insurance for tax purposes, and consequently loses most of the tax advantages that have been associated with life insurance.

A flexible premium universal life insurance policy must provide a grace period of?

30 days

Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid?

For 20 years or until death, whichever occurs first.

A man decided to purchase a 100,000 annually renewable term life policy to provide additional protection until his children finished college. He discovered that his policy?

Required a premium increase each renewal- adjusted each year to the insureds attained age. Death benefits remain level and as with any term policy there are no cash value.

Which of the following employees insured under a group life plan would be allowed to convert to individual insurance of the same coverage once the plan is terminated?

Those who have been insured under the plan for at least 5 years

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

A SEC registration- must be registered with FINRA, have a security license and must be licensed with the state to sell insurance.

Graded Premium Whole Life premiums are typically lower initially, but gradually increases for a period of 5 to 10 years. After the period of increase the premiums will?

Be level thereafter

Which option for universal life allows the beneficiary to collect both the death benefit and cash value upon the death of the insured?

Option B

An insurance policy that only requires a payment of premium at its inception, provide insurance protection for the life of the insured, and matures at the insureds age 100 is called?

Single premium whole life

A policyowner of a universal life insurance policy must receive a policy status report from the insurer at least

Annually

Annually renewable term policies provide a level death benefit for a premium that?

Increases annually

An insured purchased a life policy. The agent told him that depending upon the company's investments and expense factors, the cash values could change from those shown in the policy at issue time. The policy is an?

Interest-sensitive whole life-

An insured buys a 5-year level premium term policy with a face amount of $100,000. The policy also contains renewability and convertibility options. When the insured renews the policy in five years

The premium will increase because the insured will be 5 years older than when the policy was originally purchased.

When would a 20-pay whole life policy endow?

When the insured reaches age 100

All of the following entities regulate variable life policies except?

The Guaranty Association

What type of whole insurance policy has premiums that are adjusted so that during the first years of the policy, the premiums are lower than those of a straight whole life policy, and in subsequent years the premiums are higher than those of a straight whole life policy?

Modified life

An employee has group life insurance through her employer. After 5 years, she decides to leave the company and work independently. How can she obtain an individual policy?

She can convert her group policy to an individual policy without proof of insurability within 31 days of leaving the group plan.

What policies would be classified as a traditional level premium contract?

Straight life

Which policies is characterized by a provision where the premiums are lower in the early years of the policy and increase over time to a point where they become level for the remainder of the policy?

Graded premium whole life

At age 30 an applicant wants to start an insurance program l, but realizing that his insurance needs will likely change, he wants a policy that can be modified to accommodate those changes as they occur. What policy would most likely for his needs?

Adjistable Life- allow to increase or decrease in the face amount or premiem, so long as the premium is sufficient to pay for the mortality. An increase face amoint requires proof of insurance.

The LEAST expensive first year premiums is found in which policies?

Annually Renewable Term

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

Life paid-up at age 65

Which statement is NOT true regarding a straight life policy?

Its premium steadily decreases over time, in response to its growing cash value.

The policyowner of an adjustable Life policy wants to increase the death benefit. Which statements is correct regarding this change?

The death benefit can be increased by providing evidence of insurability

An employee quits his job on May 15 and doesn't convert his Group Life policy to an individual policy for 2 weeks. He dies in a freak accident on June 1. Which of the following statements best describes what will happen?

The insurer will pay the full Death Benefit to the beneficiary.

If an employee wants to enter the group outside of the open enrollment period, to reduce adverse Selection, the insurer may?

require evidence of insurability

What best describes annually renewable term insurance?

It is level term insurance- form of annually renewable term that offers the most insurance at the lowest cost

In a group life insurance policy, the employer may select all the following except?

beneficiary