Life Insurance Policies - Provisions, Options and riders
K pays on a $20,000 20-Year Endowment policy for 10 years and dies from an automobile accident. How much will the insurance company pay the beneficiary?
$20,000 death benefit
N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?
30 Pay Life
Which of these is an element of a Variable Life policy?
A fixed, level premium
Which statement about a whole life policy is correct?
Cash value may be borrowed against
S is covered by a whole life policy. Which insurance product can cover his children?
Child term rider
Which provision allows the policy owner to change a term life policy to a permanent one without providing proof of good health?
Conversion
A variable insurance policy
Does not guarantee a return on its investment accounts
Which of these statements describe a Modified Endowment Contract (MEC)?
Exceeds the maximum amount of premium that can be paid into policy and still have it recognized as a life insurance contract
Term insurance has which of the following characteristics?
Expires at the end of the policy period
All of these are characteristics of an Adjustable Life policy EXCEPT
Face amount can be adjusted using policy dividends
What does a Face Amount Plus Cash Value Policy supposed to pay the insured's death?
Face amount plus the policy's cash value
What kind of life insurance policy pays a specified monthly income to beneficiary for 30 years and then pays a lump sum benefit at the end of the 30 years?
Family Maintenance Policy
D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?
Level term
D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy s needed?
Level term
Which of these would be considered a Limited-Pay Life policy?
Life Paid-Up at Age 70
Which type of policy is considered to be overfunded, as stated by IRS guidelines?
Modified Endowment Contract
All of these insurance products require a producer to have proper FINRA securities registration in order to sell them EXCEPT for
Modified Whole Life
A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision?
Payor provision
Who benefits in Investor-Originated Life Insurance (IOLI) when the insured dies?
Policyowner
T would like to be assured $10,000 is available in 10 years to replace a roof on his house. What kind of $10,000 policy should T purchase?
Ten-Year Endowment
The investment gains for Universal Life Policy usually go toward
The cash value
The most important factor to consider when determining whether to convert term insurance at the insured's attained age or the insured's original age is
The cost
How does a typical Variable Life Policy investment account grow?
Through mutual funds, stocks, bonds
Which of these types of life insurance allows the policy owner to have level premiums and to also choose from a selection of investment options?
Variable Life
When is the face amount of a Whole Life policy paid?
When the insured dies or at the policy's maturity date, whichever happens first
What type of insurance offers permanent life coverage with premiums that are payable for life?
Whole Life
What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?
Whole life
A Limited-Pay Life policy has
premium payments limited to a specified number of years
