Life premiums and benefits

T and S are named co-primary beneficiaries on a $500,000 Accidental Death and Dismemberment policy insuring their father. Their mother was named contingent beneficiary. Five years later, S dies of natural causes and the father is killed in a scuba accident shortly afterwards. How much of the death benefit will the mother receive?

$0

Which of the following statements is correct regarding the tax treatment of a lump sum payment paid to a life insurance policy's primary beneficiary?

All proceeds are income tax free in the year they received

Which of these statements is incorrect regarding the federal income tax treatment of life insurance

Entire cash surrender value is taxable

If the insured and primary beneficiary are both killed in the same accident and it cannot be determined who died first, where are the death proceeds to be directed under the Uniform Simultaneous Death Act?

Insured's contingent beneficiary

A policyowner's rights are limited under which beneficiary designation

Irrevocable

Which settlement option pays a stated amount to an annuitant, but no residual value to a beneficiary?

Life Income

A Whole life insurance policy owner does not wish to continue making premium payments which of the following enables the policy owner to sell the policy for more than it's cash value

Life settlement contract

A policy owner is allowed to pay premiums more than once a year under which provision?

Mode of Premium

Which statement is true regarding a minor beneficiary

Normally, a guardian is required to be appointed in the Beneficiary clause of the contract

On a life insurance policy who is qualified to change the beneficiary designation

Policyowner

K is the insured and P is the sole beneficiary on a life insurance policy. Both are involved in a fatal accident where K dies before P. Under the Common Disaster provision, which of these statements is true?

Proceeds will be payable to K's estate if P dies with a specified time

T is covered by an Accidental Death and Dismemberment (AD&D) policy that has an irrevocable beneficiary. What action will the insurance company take if T requests a change of beneficiary?

Request of the change will be refused

What is the underlying concept regarding level premiums?

The early years are charged more than what is needed

Quarterly premium payments increase the annual cost of insurance because

interest to the insurer is decreased while the administrative costs are increased

A policyowner would like to change the beneficiary on a Life insurance policy and make the change permanent. Which type of designation would fulfill this need?

irrevocable