Types of Life Insurance Policies Quiz
Joe has a 10 year term policy. At the end of the 10 years he would like to exercise the convertible provision in his policy. He could convert to all of the following except...
10 year term
How long does it take to build cash value in a Universal Life policy?
3 years
Which form of term insurance contains the least expensive first year annual premium?
ART
There are 2 distinct periods in an annuity, what are they?
Accumulation and Annuitization
Which type of policy is best suited for a real estate agent who is dependent on straight commission for their lively hood?
Adjustable Life
Which type of policy is best suited for someone who wants the ability to change their premium, increase or decrease their face amount or change their period of protection?
Adjustable Life
What determines the amount of the payout of a Variable annuity?
Age and value
Annually Renewable Term insurance is...
An attained age policy
What is the only thing that can cause the premium to go up in an issue age policy?
An increase in benefits
Who cannot be an annuitant of an annuity?
Corporation
What type of insurance is best suited for someone who wants to borrow money from a credit union to cover their loan?
Credit Life
What decreases in Decreasing Term insurance?
Death benefit
Joe wants to take out a $30k loan to buy a car. The bank will loan him the money at 8.9% for 78 months. What type of coverage is best suited for Joe's situation
Decreasing Term
The death benefit in a variable universal life policy..
Depends on the performance of separate account.
A person selling Variable annuities must be registered with...
FINRA
What type of license do you have to have to sell a variable universal life policy?
Federal securities license and state life license
What would the premium be like in a joint life policy, compared to a survivorship life policy?
Higher
If an insured uses the Renewable Provision in his term policy, his premiums for his new policy will be based on what?
His attained age
Universal Life has two components. What are they?
Insurance and Cash Account
Who takes on all of the risk in a Universal Life policy?
Insurer
Which answer is true about the premium payment on a variable whole life policy?
It has a fixed premium
Which answer is true about the premium payment in a variable universal life policy?
It has a flexible premium
The terms most closely tied to how an annuity gets funded are...
Level and flexible
Jim would like protection and savings from his policy, but only wants to make premium payments until he retires at age 65. Which type of policy is best suited for Jim's situation?
Limited Pay Whole Life
Joe wants to purchase a permanent policy. His agent tells him that he has a couple of different options to pay his premium. He could choose a straight life policy or a limited pay policy. Joe wants to know which one will build cash value faster.
Limited Pay will build cash value faster than a straight life
Another name for the cash value in a permanent policy is...
Living Benefits
Who regulates variable insurance products?
NASD and Dept of Insurance
When are the number of annuity units determined in a Variable annuity?
On the date of the initial payout
Joe wants to add the Return of Premium Rider to his term policy. His agent informs Joe that...
Once the ROP rider is added to his policy, it will become an increasing term, instead of a level term
Which death benefit option allows the beneficiary to collect both the death benefit and the cash value when the insured dies?
Option B
Annually Renewable Term provides an increasing...
Premium
Which insurance policy only requires a payment of premium at inception and no further premium contributions?
Single Premium Whole Life
The type of insurance in a universal life policy is...
Term
What determines the cash value in a Variable policy?
Underlying investment
Which permanent policy must maintain a required IRS corridor between the cash value and the death benefit?
Universal life when Option A death benefit is chosen
What type of policy has a hedge against inflation?
Variable
With which annuity is the exact monthly benefit not known in advance?
Variable
Which policy contains a separate account?
Variable Universal Life
The words immediate and deferred refer to...
When the payout begins
Joe purchases a single premium immediate annuity. When does the payout begin?
Within the first 12 months
