Life policies
Term insurance has which of the following characteristics?
Expires at the end of the policy period
P is looking to purchase a life insurance policy that will pay a stated monthly income to his beneficiaries for 20 years after he dies and a lump sum of $20,000 at the end of that 20 year period. What type of policy should P purchase?
Family Maintenance Policy;
Which of the following statements is correct about the period in which a term policy can be converted?
It varies according to the contracts
M purchases a $70,000 Life Insurance Policy with premium payments of $550 a year for the first 5 years. At the beginning of the sixth year, the premium will increase to $800 per year but will remain level thereafter. The face amount will remain at $70,000 throughout the life of the policy. The type of policy that M has purchased is
"Modified Premium Life". Modified whole life policies are distinguished by premiums that are lower than typical whole life premiums during the first few years (usually five) and then higher than typical thereafter.
A 15-year mortgage is best protected by what kind of life policy?
15-year decreasing term
J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?
20-pay life; the shorter the pay period, the faster the cash value growth.
What kind of life insurance policy pays a specified monthly income to a beneficiary for 30 years and then pays a lump sum benefit at the end of that 30 years?
A Family Maintenance Policy pays a monthly income from the date of death of the insured to the end of the preselected period. The payment of the face amount of the policy is payable at the end of such preselected period.
Family Maintenance Policy 2
A combination of whole life insurance and level term insurance to provide permanent coverage (lump sum payment to beneficiary when the insured dies) and a monthly family maintenance portion for a set period of time following the insured's death.
What kind of insurance policy supplies an income stream over a set period of time that starts when the insured dies?
A policy that provides an income for a specific period starting at the death of the insured is a Family Maintenance Policy.
Credit Life Insurance
Credit life insurance is designed to cover the life of a debtor and pay the amount due on a loan if the debtor dies before the loan is repaid
A family income policy is combination of whole life and
Decreasing term insurance
D needs life insurance that provides coverage for only a limited amount of time while also paying the lowest possible premium. What kind of policy is needed?
Life insurance written to cover a need for a specified period of time at the lowest premium is called level term insurance
All of these insurance products require an agent to have proper FINRA securities registration in order to sell them EXCEPT for
Modified Whole Life
Family Maintenance Policy
Pays a monthly income from the date of death of the insured to the end of the preselected period. The payment of the face amount of the policy is payable at the need of such preselected period.
Family Maintenance Policy
Same as WL but w/ Level Term rider; upon death, pays monthly income for FULL term AFTER which pays full death benefit.
What kind of life insurance product covers children under their parent's policy?
Term rider
Level Term
This means you pay the same amount for the entire term of the policy
Family Plan Policies
Usually cover the family head with permanent insurance and the converse in the spouse and children is term insurance in the form of a rider.
When is the face amount of a Whole Life policy paid?
When the insured dies or at the policy's maturity date, whichever happens first
A life insurance policy that provides a policyowner with cash value along with an a level face amount is called:
Whole life
Family Plan Policies
designed to insure all family members under one policy. Coverage is sold in units. Usually the insurance covering the family head is permanent and that covering the spouse and children is level or decreasing term. Children who are born later are covered automatically.
Credit life insurance is
issued in an amount not to exceed the amount of the loan
What kind of premium does a Whole Life policy have?
level
K is looking to purchase Renewable Term insurance. Which of these types of Term insurance may be renewable?
level A level term policy payed the same benefit amount if death occurs at any point during the term. Level term policies may be renewable.
Credit Life Insurance 2
life insurance sold in conjunction with installment loans
Under a Renewable Term policy,
the renewal premium is calculated on the basis of the insured's attained age
When is the face amount paid under a Joint Life and Survivor policy?
upon death of the last insured
What kind of life policy either pays the face value upon the death of the insured or when the insured reaches age 100?
whole life
A policy that becomes a Modified Endowment Contract (MEC)
will lose many of its tax advantages