Ch.11

Which of the following pieces of information is NOT gathered during the personal financial planning process?

An individual's civic organization memberships

Buy-sell agreements are typically funded by which two insurance products?

Life insurance and disability insurance

Bob and Tom are partners in a business. If one of them were to die, which of the following would guarantee a market for each of their share of the business?

Buy-sell agreement (also known as business continuation agreements) are used to assure the ownership of a buisiness is properly tranderred upon the death or disability of an owner or partner

All of the following are considered appropriate uses of life insurance for business purposes EXCEPT

Protecting the business by covering entry level employees with life insurance

"Life insurance creates an immediate estate". This phrase means:

When the insured dies, a death benefit is paid

Key person insurance is intended to

cover business losses due to the death of a key employee

Which of these is a method of determining the level of funds required for ongoing support in the event of the breadwinners death?

Human life value

All of the following are examples of a business continuation plan EXCEPT

deferred compensation

The human life value concept is based on

Income

All of these are common personal uses of life insurance EXCEPT

Fund a buy-sell agreement