Life Insurance Policies
A minor
Who is insured under a juvenile life policy?
Whole life
What type of insurance policy provides permanent protection?
When the insured reaches age 100
When would a 20-pay whole life policy endow?
The employer ( also known as the sponsor of the group)
Who owns a group life insurance contract?
There is no cash value to borrow against
Why are policy loans not available on term insurance?
Age 100
The policy owner 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?
For 20 years or unitll 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 pai for what time period?
Loan value
WHat are the living benefits of a whole life insurance
Premium payment mode
What is the major difference between the most common types of whole life policies: straight, limite payment and single premium?
To prevent the policy from lapsing
What is the purpose of establishing the target premium for a universal life policy?
WHole life policies provide protection untill the insured reaches what age
100
20 -year level term
A policy states that it will pay a speecified 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?
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?
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
An individual has just borrowed 10,000 on a 5-year note from his bank. The note is due in installments. What type of life insurance policy would be best suited to this situation?
Annualy renewable term
The death protection component of a universal life policy is expressed as what type of coverage
Universal life
Between adjusting life and universal life policies which one provides more flexibility to the policyowner?
Annualy 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?
Universal life
IN what type of life insurance policies can the policyowner skip premium payments without policy lapsing?
Evidence of insurability
If an employee want to join group life insurance coverage outside of the open enrollment period, what would the employee have to provide?
Whole life
If an insured terminates membership in group life insurance, to what type of insurance can the insured convert the coverage?
Upon the first death
In a joint life policy when is the death benefit paid?
The insured's attained age
In annualy renewable term policies, what is the annual premium based upon?
The premium remains level
In term policies, what happens to the premium throughout the term of the policy?
Cash value and death benefit
In variable universal life insurane, to what policy component does the term variable refer?
Tax defered
Regarding taxation, how does the cash value of a universal life policy accumulate?
Under option B the death benefit increases each year by the amount of the cash value increases
Under option B in a universal life policy what happens to the death benefit?
Guaranteed and current
Universal life policies have two types of interest rates. What are they?
Group's purpose, size, financial strength and turnover
What are the characteristics of the group that underwriters will consider before issuing a group life policy
Option A- level death benefits and Option B - increasing death benefits
What are the death benefits in universal life policies
Face amount
What does level refer to in level term insurance?
The amount and payment period of the premium, the face amount, and the period for protection
What elemts of an adjustable life policy can be changed by the policyowners?
Cash value is paid to the policyowner
What happens to the cash value when a whole life insurance policy matures?
The premium increases with each renewal?
What happens to the premium in an annualy renewable term life policy?
Evidence of insurablity 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?
Decreasing term
What type of life insurance is best suited to cover a mortgage?
Limited-pay whole life
What type of life insurance is life, paid-up at age 65?
Convertible term
What type of life insurance policy can be changed from a policy with no cash value to one that generates cash
Term
What type of life insurance policy offers pure death protection?
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 polices only requires a payment of premium at its inception and in addition to provisind insurance protection for the life of the insured, endows at the insured's age 100?
Single premium whole life
What type of whole life insurance policy generates immediate cash value?
Option A
What universal life option has a gradually increasing cash value and a level death benefit
When the premiums paid are more than the cost of the policy
When does the adjustable life policy accumulate cash value
Evidence of insurability
When the amount of insurance is increased in an adjustable life policy, what will the insurer require from the insured?
The policyowner
Who is entitled to the cash values in a life insurance policy?
The full death benefit
Whole life insurance policies mature when the insured reaches the age of 100. If the owner of a whole life policy (the insured) dies at age 80, and there are no outstanding loans on the policy, what portion of the death benefit will be paid to the beneficiary?