Type of insurance policies
A single premium cash value policy can be described as
A policy that is paid up after only one payment
Which of these would be the best example of a limited pay life insurance policy
Whole life policy with premiums paid up after 20 years
Sean Mike and Dave are brothers to have a $100,000 first to die joint life policy covering all three of their lives if Mike dies first, the policy proceeds
Will no longer provide insurance protection
Variable life insurance and universal life insurance are very similar. Which If these features are held exclusively by variable universal life insurance?
Policyowner has the right to select the investment which will provide the greatest return
Which of these describes the result of a modified endowment contract that failed to meet to 7Pay test
Pre death distributions are typically taxable
Under a MEC, What are the likely tax consequences
Pre-death distributions will become taxable
How are survivorship life insurance policies helpful in estate planning?
Provide tax deductions for premium payments
Which of the following are the premium payments for a universal life policy not used for
Separate account investments
Which type of multiple protection policy peas on the death of the last person
Survivorship life policy
Which type of life insurance policy pays the face amount at the end of the specified period if the insured is still alive?
Endowment policy
Peter has a policy where 80% to 90% of the premium is invested in traditional fixed income securities and the remainder of the premium is invested in contracts tied to a stipulated stock index. What kind of policy is this
Equity index whole life
A spouse and a child can be added to the primary insurance coverage as what kind of rider
Family term
Which of these riders I will pay a death benefit if the insured's spouse dies
Family term insurance rider
All of these characteristics of a universal life insurance policy except
Fixed surrender value
Which policy future makes a universal life policy different from a whole life policy
Flexible premium schedule
A business will typically use which type of life insurance to cover their employees
Group policy
The type of multiple protection coverage that pays on the death of the last person is called
Hey survivorship life policy
And life insurance policy written on a contract for two people in which is payable upon the first death is called
Joint
Which type of life insurance is normally associated with a payor benefit rider
Juvenile insurance
What kind of life insurance policy covers 2 or more people with the death benefit payable upon the last persons death
Last survivor life insurance
A renewable term life insurance policy can be renewed
at a predetermined date or age, regardless of the insured's health
The least expensive option to pay off a 30 year mortgage balance would be
decreasing term life
Level premium permanent insurance accumulates a reserve that will eventually
equal the face amount of the policy
Index whole life insurance contains a securities component that acts as a
hedge against inflation
A limited payment whole life policy provides
lifetime protection
A permanent life insurance policy where the policyowner pays premiums for a specified number of years is called a(n)
limited pay policy
The premium for a modified whole life policy is
lower than the typical whole life policy during the first few years and then higher than typical for the remainder
Shirley has a $500,000 10-year non-renewable level term life policy. If she dies 15 years after the policy's inception date, how much will her beneficiary receive?
nothing
An interest-sensitive life insurance policyowner may be able to withdraw the policy's cash value interest free. The provision that allows this is called
partial surrender
Rob purchased a standard whole life policy with a $500,000 death benefit when he was age 30. His insurance agent told him the policy would be paid up if he reached age 100. The present cash value of the policy equals $250,000. Rob recently died at age 60, the death benefit would be
$500,000
A modified endowment contract is best described as
A life insurance contract which accumulates cash value is higher than the IRS will allow
All of these are valid options for an adjustable life policy except
A nonforfeiture option can be used to increase the death benefit
A policyowner may change two policy features on what type of life insurance?
Adjustable Life
Donald is the primary insured of a life insurance policy and adds a children's term rider. What is the advantage of adding this rider
Can be converted to permanent coverage without evidence of insurability
Jonas is a whole life insurance policy owner I would like to add coverage for his two children. Which of the following products would allow him to accomplish this
Child term rider
What happens to the coverage under a children's term rider when that child reaches a certain specified age
Coverage is eliminated
Which of these is not subject to income taxation under a MEC
Death benefit
Julie has a $100,000 30-year mortgage on her new home. What type of life insurance could she purchase that is designed to pay off the loan balance if she dies within the 30-year period?
Decreasing term insurance
When a decreasing term policy is purchased, it contains a decreasing death benefit and
Level premiums
A life insurance policy that has premiums fully paid up with any stated time period is called
Limited payment insurance
What does the word "level" in level term describe
The face amount
Joe has a life insurance policy that has a face amount of $300,000. After a number of years, the policies cash value accumulates to $50,000 and the face amount becomes $350,000. What kind of policy is this
Universal life policy
Which type of life insurance offers flexible premiums, a flexible death benefit, and the choice of how the cash value will be invested
Variable universal life policy
Which type of policy combines the flexibility of a universal life policy with investment choices
Variable universal life policy
A life insurance policy which contains cash values that vary according to its investment performance of stocks is called
Variable whole life
All of these statements concerning whole life insurance or false except
When a whole life policy is surrendered, income taxes may be owed
Decreasing term life insurance is often used to
provide coverage for a home mortgage
What is the automatic continuance of insurance coverage referred to as
renewal
Term insurance is appropriate for someone who
seeks temporary protection and lower premiums
Which of the following policies does not build cash value?
term
What types of life insurance are normally used for key employee indemnification?
term, whole, and universal life insurance
Pre-death distributions from a modified endowment contract (MEC) receive different tax treatment than other life insurance policies because
the MEC tends to be an investment vehicle
A securities license is required for life insurance producer to sell
variable life insurance
A renewable term life insurance policy allows the policyowner the right to renew the policy
without producing proof of insurability
Krissa purchases a 10-year level term life insurance policy that has a death benefit of $200,000. Which of these statements is true?
The face amount and premium will remain constant over the 10-year period
What is a Corredor in relation to a universal life insurance policy
The gap between the total death benefit in the policies cash value
The statement which best describes the relationship between the premiums of a whole life policy and the premium payment. Is
The shorter the payment. The higher the premium
A life insurance policy that contains a guaranteed interest rate with the chance to earn a rate that is higher than the guaranteed rate is called
Universal Life
A life insurance policy that is subject to a contract interest rate is referred to as
Universal Life
A partial surrender is allowed in which of the following life policies?
Universal Life
Reggie purchased a life insurance policy with a face amount of $500,000. After 15 years, the cash value has accumulated to $100,000 and the policy's face amount has become $600,000. Which type of life insurance policy is this?
Universal Life