Types of life Policies

What is variable universal life insurance

(a securities version of the universal life insurance.)

If a person has life insurance through work how long do they have to convert to an individual policy without proof of insurability?

31 days

Under Option ___ the death benefit remains ______ while cash value gradually ___________ there by ________ the pure insurance and allowing for greater________ in the older years

A,Level, Increase, Lowering

What is the purest form of term insurance?

ART

What are the flexible premium Policies?

Adjustable life(term and perm) , Universal Life(Flexible premium , Indexed life( Tied to Equity index)

How are premiums determined in group life insurance?

Age, Sex, and occupation of the entire group

The simplest way to explain a universal life account is?

An Annually Renewable Term Policy with a cash value account

When can a policy owner skip paying a premium and not have their policy lapse in a Universal Life Policy?

As long as the policy contains sufficient cash value to cover the cost of insurance

What can you not do in an Adjustable Life Policy?

Change the type of investment

in Credit life who is the owner and the beneficiary of the policy ?

Creditor

What are examples of permanent risks?

Death and Taxes

What does level mean in level term insurance?

Death benefit stays level thought-out the term of the policy

Under Option B, at any point in time, the total death benefit will always be ______to the face amount of of the policy plus the current amount of cash value

Equal

What two features distinguish group insurance from individual ?

Evidence of insurability is usually not required Participants under the plan do not receive a policy because they do not own or control the policy

In a increasing term policy the face amount

Increases

In what situations is Joint Life used for?

Joint when there is a need for two or persons to be protected however the need for insureds is no longer present after the insureds die.

In a level term policy the premium is ________ l?

Level

Regardles of type of term insurance The premium is _________ throughout the term of the policy

Level

What are the 4 basic types of term insurance?

Level , Increasing , decreasing,ART

What are the 4 characteristics of whole life policy

Level Premium , death , benefit, Cash Value, living benefits

Why is survivor ship a life policy have lower premiums than a join life policy all things being equal?

Life Expectancy is longer so the insurance company takes on less risk. Less risk lower the insurance premiums. Higher the risk Higher the premiums

What type policy is issued to the sponsor of a group policy ?

Master Policy / Contract

In Universal Life Policies , since the premium can be adjusted, the insurance companies may give the policy Owner a choice to pay what two types of premiums?

Minimum - the amount needed to keep the policy in force for the current year(will make it ART) Target - amount to be paid in order to cover the cost of insurance keep the policy in force for lifetime

What are some causes of concern for a group underwriter?

Purpose of the group( other than insurance) Size of the group, Turnover of the group , financial strength of the group

Surviorship polices pay out on which death? Premiums are base on ______________

Second death only , joint avearge age

The federal government has declared that variable contracts are considered ___________ and are regulated by the SEC

Securities

To sell Variable life policies what type of license must you have?

Securities license

What are the 3 basic forms of whole life?

Straight life( continuous Payments) Limited pay( Limted pay period , Single premium( one payment)

Regarding Length of coverage, what category does term insurance fall under?

Temporary

Regarding the length of coverage, all life insurance policies fall into what 2 catergories

Temporary and permanent protection

Why is term insurance referred to as pure death insurance?

The only value it provides is insurance in the case of death

What is target premium in universal life polices?

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

Is evidence of insurability required to enter a group life policy?

Usually it is not. If so, it is used to reduce adverse selection

What is the key feature in indexed whole life( equity indexed whole life) insurance

cash value is depended upon the performance of the equity index such as S&P 500,

each insured participant under the group plan is issued a________

certificate of insurance for evidence they have coverage

What are examples of temporary risks

Mortage , auto loans, children's education , paycheck protection

In a Decreasing Term policy the Face amount ______________

decreases

What's the conversion privilege in group life policies?

employee has theright to convert to an individual policy w/o proving insurability at standard rate, based on the attained age. has a period of 31 days

What is variable life insurance

level, fixed premium, investment based product

What is permanent insurance ?

life insurance policies that build cash value and remain in effect for the entirelife of the insured (or until age 100) as long as the premium is paid.

In what situations is Surviorship Life used for?

offset the liability of the estate tax

What is the Key feature in variable life insurance

permanent insurace with

Universal life insurance is also known by the generic name "flexible premium adjustable life" Why?

policyowner has the flexibility to increase amount of premium paid into the policy and later decrease it again. even skip paying the premium

what is credit insurance?

special type of coverage written to insure the life of the debtor and pay off the balance of a loan in the event of the death of the debtor.Credit life usually written as decreasing term

Who is the policy owner in credit life insurance

Creditor is the policy owner and beneficiary, the debtor is the insured

Agents selling variable life insurance products must be registered with

FINRA

Agents selling variable life products must be registered with ________

FINRA

Joint life policies pay out on which death?The premiums are based on a____________

First Death only,joint average age

What privileges do you have with and adjustable life policy?

Increasing or decreasing the premium, changing the premium -paying period , increasing or decreasing the face amount , changing the period of protection

Death benefit stays level thought-out the term of the policy

Increasing term

What decreases in a decreasing term policy? What remains level?

Only the face amount decreases. The premiums are level.

Universal Life has two death benefit options. What are they ?

Option A - Level death Benefit Option B - Increasing death benefit option

Which option for Universal life allows the beneficiary to collect both the death benefit and cash value upon death of the insured?

Option B

Permanent coverage covers _______Risks? Temporary Coverage covers_______Risk

Permanent Temporary