Life Insurance Policies
Convertible term
What type of life insurance policy can be changed from a policy with no cash value to one that generates cash value?
20 - year level term
A Policy states that it will pay a specified face amount if the insured dies during the 20 year premium-paying period and nothing if death occurs after the 20 year period. what type of policy is this?
Guaranteed and current
Universal life policies have two types of interest rates, What are they?
Whole Life
What type of life insurance policy provides permanent protection?
Age 100
The policyowner of a whole life insurance policy is also the insured. What age must the insured attain in order to receive the policy's face amount?
Single Premium whole life
What type of whole life insurance policies only requires a payment of premium at its inception, and in addition to providing insurance protection for the life of the insured, endows at the insured's age 100?
Annually renewable term
The death protection component of a universal life policy is expressed as what type of coverage?
Decreasing term
An individual has just borrowed $10,000 on a 5-year note from his bank. The note is due to installments. What type of life insurance policy would be best to this situation?
Universal life
Between adjustable life and universal life policies, which one provides more flexibility to the policyowner?
Interest earned on the withdrawn cash value
During Partial withdrawal from a universal life policy, which portion , if any, will be taxed?
Whole life
If an insured terminates membership in group life insurance, to what type of insurance can the insured convert the coverage?
Tax Deferred
Regarding taxation, how does the cash value of a universal life policy accumulate
Group's purpose, size, financial strength and turnover.
What are the characteristics of the group
Evidence of insurability is not required
What is the main advantage of converting from group life insurance to individual coverage?
Face Amount
What policy component must decrease in decreasing term insurance?
Option A
What universal life option has a gradually increasing cash value and a level death benefit?
When the insured reaches age 100
When would a 20-pay whole life policy endow?
Annually renewable term
Group life Insurance policies are written as what type of Insurance?
The premium is based on the average age of the insureds
How is the premium determined in a joint life insurance policy?
Evidence of insurability
If an employee wants to join a group life insurance coverage outside of the open enrollment period, what would the employee have to provide?
Upon the first death
In a joint life policy, when is the death benefit paid?
Option A - level death benefit, and Option B - increasing death benefit
What are the death benefit options in universal life policies?
When the premiums paid are more than the cost of the policy
What does an adjustable life policy accumulate cash value?
The Amount and payment period of the premium, the face amount, and the period for protechtion
What elements of an adjustable life policy can be changed by the policyowners?
The policyowner
Who is entitled to the cash values in a life insurance policy?
the policyowner
Who is entitled to the cash values in a life insurance policy?
A minor
Who is insured under the juvenile life policy?
Limited-pay whole life
A whole life policy that requires that the policyowner only pays premiums for a specified number of years is known as what kind of policy?
Decreasing Term
What type of life insurance is best suited to cover a mortgage?
Limited - pay Whole life
What type of life insurance policy is Life Paid-up at age 65?
Whole life
What type of life insurance policy provides permanent protection?
A level of premium for the life of the insured
What type of premium is charged on a straight life policy?
A level premium for the life of the insured
What type of premium is charged on a straight life policy?
Single premium whole life
What type of whole life insurance policies only requires a payment of premium at its inception, and in addition to providing insurance protection for the life of the insured, endows at the insured's age 100?
There is no cash value to borrow against
Why are policy loans not available on term insurance?
age 100
whole life policies provide protection until the insured reaches what age?
For 20 years or until the insured's death, whichever occurs first.
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 what time period?
The premium increases with each renewal
What happens to the premium in an annually renewable term life policy?
Single Premium whole life
What type of whole life insurance policy generates immediate cash value?
Cash value is paid to the policyowner
What happens to the cash value when a whole life insurance policy matures?
The insured's attained age
In annually renewable term policies, what is the annual premium based upon?
Cash value and death benefit
In variable universal life insurance, to what policy component does the term 'variable' refer?
Term
What type of insurance policy offers pure death protection?
Cash value is paid to the policyowner
What happens to cash value when a whole life insurance policy matures?
Limited - pay whole life
A Whole life policy that requires that the policy owner only pays premiums for a specified number of years is known as what kind of policy?
The amount of the loan will be subtracted from the death benefit.
A policyowner borrowed a portion of cash value from his whole life policy. If the loan is not repaid, how will that affect the death benefit to the beneficiary?
Term
What type of life insurance policy offers pure death protection?
Premium payment mode
What is the major difference between the most common types of whole life policies: Straight life, limited payment and single premium?
The employer (also known as the sponsor of the group)
Who owns a group life insurance contract?
Universal life
In what type of life insurance policies can the policyowner skip premium without the policy lapsing?
