10 - Uses of Life Insurance (Test only has 5 questions)
Which statement regarding third-party ownership of a life-insurance policy is true?
It is used extensively in estate-planning as well as business circumstances
Which statement regarding a Key Employee Life policy in NOT true?
The beneficiary is named by the Key employee
A Key Employee policy is taken out by Company X on it's vice president. Ten years later, this employee leaves company X and begins working for Company Y. If this individual were to die and the policy is still in force and unchanged, where would the death proceeds be directed?
Company X
Which of these factors does not influence and applicant's need for life insurance?
Self-maintenance expenses
Which type of plan allows an employer to give money to an employee for buying a life insurance policy and also permits the employee to select the beneficiary?
Split-dollar plan
Company Z has a Cross Purchase Buy-Sell Agreement in place among its three founding partners. If the agreement is funded with individual life insurance, what would it require?
Each partner must own a policy on the other partners
Which statement regarding a Key Employee Life policy in NOT true?
The beneficiary is named by the key employee
Which of these is NOT a reason for purchasing life insurance on the life of a minor?
If both parents were to die, it would provide death benefits to the child