Insurance Exam: Chapter 2

which of the following policies would have an IRS required corridor or gap b/w the cash values and the death benefit

Universal life- Option A

the type of policy that can be changed from one that does accumulate cash value to the one that does

convertible term policy

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

"second-to-die" policy?

survivorship life

which of the following determines the cash value of a variable life policy?

the performance of the policy portfolio

when would a 20-pay whole life policy endow?

when the insured reaches age 100

The insured is also the policyowner of a whole life policy. What age must the insured attain in order to receive the policy's face amount?

100

twin brothers are starting a new business. They know it will take several years to build the business to the point they can pay off the debt incurred starting the business. What type of insurance would be the most affordable and still provide a death benefit should one of them die?

joint life

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

interest sensitive whole life

Why is an equity indexed annuity considered to be a fixed annuity?

it has a guaranteed minimum interest rate

all of the following are true about variable products EXCEPT?

the premiums are invested in the insurers general account

which of the following best defines target premium in a universal life policy

the recommended amount to keep the policy in force throughout its lifetime

A domestic insurer issuing variable contracts must establish one or more

separate accounts

all the following statements about equity index annuities are correct EXCEPT?

the annuitant receives a fixed amount of return

If the annuitant dies during the accumulation period, who will receive the annuity benefits?

the beneficiary