(Life) Types of Life policies
joint and survivor arrangement lets survivor be paid _ of what was paid when both were alive
2/3
purest form of term insurance
ART (annually renewable term)
term insurance has or doesnt have cash value?
DOESNT
death benefit changes or no in level term insurance?
NO
to sell variable life insurance, agent must get all except
SEC registration
if insured skips premium on universal policy, it will or wont lapse?
WONT
_ period aka pay in period, time over which owner makes payments into annuity
accumulation
variable premiums purchase _ units in the fund
accumulation
(types of whole life policies) _ life can be either term or permanent, and convert between the 2. reqs proof of insurability
adjustable
joint life premium based on joint avg _ between insureds
age
fixed _ installments, annuitant selects how much each payment will be, insurer determines how long benefits paid
amount
if annuitant dies b4 annuitization, what will beneficiary get?
amount into plan or cash value, whatevers GREATER
least expensive first year premium?
annually renewable term
receives benefits of annuity, and for whom its written
annuitant
true regarding variable annuities?
annuitant assumes risk
_ period aka annuitization, liquidation or pay-out period is time during which sum accumulated is converted to stream of income
annuity
contract that provides income for specified period of yrs or for life
annuity
_ age is insured's age at time policy issued or renewed
attained
person who gets annuity benefits if annuitant dies
beneficiary
feature of variable annuities
benefit payment amounts NOT guaranteed!
(annuity refund) _ refund, beneficiary gets lump sum refund of principal minus benefits paid to annuitant
cash
_ value is policy's savings element or living benefit
cash
_ value of adjustable life only develops when premiums paid are more than cost of policy
cash
whole life insurance gives lifetime protection and accumulates _ value
cash
_ provision provides policyowner with right to covert policy to permanent insurance policy WITHOUT evidence of insurability
convertible
term insurance gives pure _ protection
death
ROP pays additional
death benefit
_ term, premium is level but death benefit or face amount decreases
decreasing
person borrows $$ from bank on loan with monthly payments, what type of life insurance would be best suited
decreasing term (face amount decreases with debt)
_ annuity, income payments start after 1 yr of purchase
deferred
withheld or postponed until specific time or event
deferred
variable life insurance products _ regulated by state and federal gov't
dually
incorrect regarding 100k 20 level term policy
end of 20 yrs, cash value is 100k
_ amount is amount for benefit stated in policy
face
joint life death benefit paid and stops upon _ death only
first
annuities may be classified as _ or variable
fixed
why is equity index annuity considered to be fixed annuity?
guaranteed minimum interest rate
_ annuity purchased with single lump sum payment/premium and income payments start within 1 yr
immediate
annuity for lottery benefits?
immediate annuity
ROP has a significant _ in premium cost, 25-50%
increase
(universal life) option B death benefit _ with cash value
increases
in ART, death benefit is same but premium _ annually
increases
return of premium (ROP) is _ term insurance
increasing
_ whole life, cash value dependent upon performance of equity index such as S&P 500
index
_ annuities are fixed that invest on aggressive basis to get higher returns
indexed
_ refund, beneficiary gets guaranteed installments until paid out
installment
in fixed annuity who bears risk?
insurance company
(universal life) has 2 components, _ and _ account
insurance, cash
what is taxed in partial withdrawal from universal life policy?
interest
_ life is designated for 2+ lives, can be term or permanent
joint
(universal life) option A death benefit is _, cash value increases
level
_ premium is when premium doesnt change thru life policy
level
fixed annuities gives a _ benefit payment amount
level
level premium term gives _ death benefit and premium
level
regardless of type of term policy, premium is
level
NOT type of whole life?
level term
most common type of temporary protection
level term
(types of whole life policies) higher annual premium, cash value builds up faster
limited pay life
basic function of annuity is to _ a principal sum
liquidate
_ is converting net worth into cash flow
liquidation
insured gets full face amount from whole life policy if
lives to 100
premium of survivorship compared to joint life is
lower
term policy gives the greatest coverage for the _ premium
lowest
date or time at which face amount equals cash values
maturity
policy _ is time when face value is paid out
maturity
insured gets 10 yr term life policy thats guaranteed renewable and convertible, what happens at end of 10 yrs?
may renew for another 10, higher premium
(annuity payment) life w/ guaranteed _, if annuitant dies b4 principal amount paid, remainder of principal amount goes to beneficiary
minimum
(universal life) amount needed to keep policy in force for current year is _ premium
minimum
shorter life expectancy gets _ benefit opposed to longer life expectancy
more
decreasing term common to insure payment of
mortgage
annuitant must be a _ person
natural
_ values is benefits in life insurance policy that policyowner cant lose even if policy surrendered or lapses
nonforfeiture
fixed _ installments, annuitant selects time period for benefits, specified amount of time only, whether or not annuitant living
period
_ life insurance refers to various types of life insurance policies that remain in effect for entire life of insured (or until age 100)
permanent
ROP, if insured stays healthy and alive when term expires, guaranteed return of _, not taxable
premium
(annuity payment) _ life aka life only aka straight life, payment ceases at annuitants death, highest monthly benefits
pure
best describes pure life annuity settlement
pure life gives payment as long as annuitant is alive
(universal life) insurance component is always annually _ term insurance
renewable
_ provision allows policyowner rights to renew coverage WITHOUT evidence of insurability
renewable
annuities purchased primarily for _ , or to fund _
retirement, college
in variable contracts, policyowner bears investment _
risk
financial instruments that may trade for value (stocks, bonds, etc)
securities
interest _ whole life aka current assumption life, provides guaranteed death benefit to age 100
sensitive
annuities certain are _ term annuities that limit amount paid to certain fixed period
short
(types of whole life policies) completely paid up after 1 premium and generates immediate cash
single premium whole life
(types of whole life policies) basic, lowest annual premium
straight life
annuities also used to provide _ settlements
structured
_ life pays on last death instead of first death
survivorship
(universal life) recommended amount that should be paid on policy in order to cover cost of insurance protection and keep policy in force is _ premium
target
term insurance (aka pure life) is
temporary
all life policies fall into 2 categories:
temporary and permanent
level, increasing, and decreasing are all types of _ coverage based on how face amount (death benefit) changes
term
(types of whole life policies) _ life, policyowner can increase premium paid into policy and decrease again
universal
variable _ life combines features of whole life with flexible premium of universal life, securities version of universal
universal
all true regarding convertibility option under term life insurance policy except
upon conversion, death benefit of permanent policy reduced by 50%
(types of whole life policies) _ life is level, fixed premium, investment based
variable
_ annuity is a hedge vs inflation and is variable that annuitant may get diff rates of return on funds into annuity
variable
annuities are a _ for liquidation of estate
vehicle
most common type of permanent insurance, endow at insured's age 100
whole life
(universal life) allow partial _ of policy cash value
withdraw
