Uses of Life Insurance
All of the following are examples of a Business Continuation Plan EXCEPT Key person insurance Cross-purchase agreement Stock Redemption Plan Deferred Compensation
Deferred compensation
Craig purchased a life insurance policy for enabling his heirs to pay estate taxes. What is this called? Estate conservation Liquidity maintenance Survivor fund Human value protection
Estate conservation
Which of these is a method of determining the level of funds required for ongoing support in the event of the breadwinner's death? Financial loss value Human life value Assessment value Replacement value
Human life value
Which approach predicts a person's earning potential and determines how much of that amount would be devoted to dependents? Future value approach Earnings approach Needs approach Human life value approach
Human life value approach
All of the following are considered appropriate uses of life insurance for business purposes EXCEPT Attracting quality employees by offering a group life plan Funding an entity buy-sell agreement Protecting the business by covering key employees with life insurance Protecting the business by covering entry level employees with life insurance
Protecting the business by covering entry level employees with life insurance
When calculating the amount of life insurance needed for an income earner, what has to be determined when using the Needs Approach? The income earner's future projected income The family's financial objectives if the income earner were to die or become disabled The insurance company's financial rating The income earner's credit score
The family's financial objectives if the income earner were to die or become disabled
Which of these factors is NOT taken into account when determining an applicant's life insurance needs? Social Security automobile savings pension
automobile