LIFE INSURANCE POLICIES

A Universal Life insurance policy has two types of interest rates that are called

Guaranteed and Current

The death protection component of Universal Life Insurance is always

Annually Renewable Term

In a survivorship life policy, when does the insurer pay the death benefit?

Upon the last death

A domestic insurer has just decided to change the investment policy of a separate account. After this change is filed with the Director, how soon will it become effective?

60 days

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

Option B

Which of the following types of insurance policies is most commonly used in credit life insurance?

Decreasing term

What are the two components of a universal policy?

Insurance and cash account

If a life insurance policy increases significantly in face amount (death benefit) when the insured reaches a specified age, what type of policy is this?

Jumping juvenile policy

All other factors being equal, the least expensive first-year premium payment is found in

Annually Renewable Term.

In a group life insurance policy, the employer may select all of the following EXCEPT

The beneficiary

Credit Life insurance

Insures the life of a debtor

Your client wants both protection and savings from the insurance, and is willing to pay premiums until retirement of age 65. What would be the right policy for the is client?

Limited pay whole life

A man decided to purchase a $100,000 Annually Renewable Term Life policy to provide additional protection until his children finished college. He discovered that his policy

Required a premium increase each renewal

Which of the following policies would have an IRS required corridor or gap between the cash value and the death benefit?

Universal Life - Option A

An insurance policy that only requires a payment of premium at its inception, provides insurance protection for the life of the insured, and matures at the insured's age 100 is called

Single premium whole life

An employee quits his job on May 15 and doesn't convert his Group Life policy to an individual policy for 2 weeks. He dies in a freak accident on June 1. Which of the following statements best describes what will happen?

The insurer will pay the full death benefit from the group policy to the beneficiary.

Which of the following is TRUE about credit life insurance?

Creditor is the policyowner.

Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid

For 20 years or until death, whichever occurs first.

A Universal Life Insurance policy is best described as

An Annually Renewable Term policy with a cash value account

Which of the following is an example of a limited-pay life policy?

Life Paid-up at Age 65

Which of the following statements is true regarding the cash value in a Universal life policy?

The insurer credits the cash value in the policy with a current interest rate.

The policyowner of an adjustable life policy wants to increase the death benefit. Which of the following statements is correct regarding this change?

The death benefit can be increased by providing evidence of insurability.

All of the following statements are correct regarding Credit Life Insurance EXCEPT

Benefits are paid to the borrower's beneficiary.

All other factors being equal, what would the premium be like in a survivorship life policy as compared to the premium in a joint life policy?

Lower

An insured has a Level Term Life Insurance policy that is guaranteed renewable and also includes a re-entry provision. The re-entry provision would allow the insured to renew the policy and

Pay lower renewal premium by proving insurability.

All of the following are true regarding a decreasing term policy EXCEPT

The payable premium amount steadily declines throughout the duration of the contract

Which of the following would help prevent a universal life policy from lapsing?

Target premium

Which of the following statements about group life is correct?

The cost of coverage is based on the ratio of men and women in the group.

An employee quits his job and converts his group policy to an individual policy; the premium for the individual policy will be based on his

Attained age

When would a 20-pay whole life policy endow?

When the insured reaches age 100

An insured buys a 5-year level premium term policy with a face amount of $10,000. The policy also contains renewability and convertibility options. When the insured renews the policy in 5 years, what will happen to the premium?

It will increase because the insured will be 5 years older than when the policy was originally purchased.

Which statement is NOT true regarding a Straight Life policy?

Its premium steadily decreases over time, in response to its growing cash value.