personal finance chapter 12

16. An authoritative rating guide to the financial stability of the nation's insurers is published by all of the following except:

Dow Jones & Company.

3. Which is a correct statement about life insurance?

People are less apt to actively seek life insurance than health insurance

8. Which of the following is (are) false?

You can expect to receive a policy dividend from a stock company

5. You probably have little or no need for life insurance if you are:

a single person living alone or with parents

2. Typical examples of uses of life insurance proceeds include:

all of these

19. A financial contract written by an insurance company to provide you with a regular monthly income for as long as you live is called

an annuity

15. In planning your insurance program, you should:

consider all of the factors listed in the other answers

12. Richard Beck has a life insurance policy which he has altered to include an accidental death benefit payable to his son and daughter. This alteration has most likely been done by attaching a(n) ____ to the policy.

double indemnity rider

17. The lump-sum payment settlement option is the least used option.

false

6. Nearly all mutual companies issue only nonparticipating policies.

false

20. A prime reason for buying an annuity is to:

give you retirement income for the rest of your life

9. Most participating policies are sold by:

mutual life insurance companies

1. Most people buy life insurance to protect someone who depends on them from financial losses caused by their death.

true

10. An important provision in every life insurance policy is the right to name your beneficiary.

true

11. A rider is any document attached to the policy that modifies its coverage by adding or excluding specified conditions or altering its benefits.

true

13. An interest-adjusted index is a method of evaluating the cost of life insurance by taking into account the time value of money.

true

14. Life insurance is available from a wide range of private and public sources.

true

18. Under the life income option, payments are made to the beneficiary for as long as he or she lives

true

7. A term insurance policy pays a benefit only if you die during the period that the policy covers.

true

4. What should you consider before you buy life insurance?

you should consider all of the factors listed