4 - Life Insurance Policies - Provisions, Options and Riders - Exam 1
a modified endowment contract
An insurance policy written after 1988 that fails to pass the seven-pay test is known as
Second-to-die policy
John and Mary have a handicapped child that is financially dependent upon them. The death of one of the parents would not be financially disastrous, however the death of both likely would be. Which policy would be best suited for them?
10%
Mark, age 45, has a Modified Endowment Contract (MEC). What is the tax penalty for taking a loan against this policy prior to age 59 1/2?
Modified premium, ordinary life, single premium
What is the proper order of initial life insurance premiums, from lowest to highest?
Applicants are not required to answer medical questions on the application
Which of the following is NOT a true description of non-medical life insurance?
Conversion of child's coverage to permanent insurance requires evidence of insurability
Which of the following is NOT true regarding a family policy that covers children?
endowment insurance
A life insurance policy that pays the face amount if the insured survives to a specified period of time is called
variable life
A life insurance policy where the insured can choose where the cash value can be invested is called
the policy's face amount
A life insurance policy's limit of liability would be
10%
In a modified endowment contract, the penalty tax imposed on withdrawals is
require a higher premium payable at each renewal
In a renewable term life insurance policy, the contract will usually
Non-medical
Which of the following is a life insurance policy that does NOT require a physical exam?
Only children born prior to policy's issue date may be included
Which of the following statements do NOT apply to child coverage in a family policy?
Universal life
Which of the following types of life insurance combines a savings element along with a flexible premium option?
Decreasing term"
Which of the following types of life insurance is normally associated with a mortgage loan?
