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A variable insurance policy:
-guarantees a minimum rate of return
-does not allow the policyowner to assume the investment risk
-does not guarantee a return on its investment accounts
-does not guarantee an assignment provision
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does not guarantee a return on its investment accounts
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Which statement about a whole life policy is correct?
-Beneficiary may be changed only with the consent of the premium payor
-Death benefit can usually be adjusted
-Cash value may be borrowed against
-Premiums are flexible
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-Cash value may be borrowed against
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Which statement is correct regarding the premium payment schedule for whole life policies?
-Premiums are payable throughout the insured’s lifetime/ coverage lasts until death of the insured
-Premiums are payable for a set period/ coverage expires at that point
-Premiums are payable until age 65/ coverage lasts a lifetime
-A single premium is paid at time of application/ coverage lasts until retirement
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-Premiums are payable throughout the insured’s lifetime/ coverage lasts until death of the insured
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A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as
-Adjustable Life
-Graded-Premium Life
-Variable Life
-Modified Whole Life
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-Variable Life
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What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?
-Modified whole life
-20-year paid up policy
-Endowment
-Decreasing term
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-Decreasing term
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How does a typical Variable Life Policy investment account grow?
-Tied to price of gold
-Through mutual funds, stocks, bonds
-Based on returns from insurer’s general account
-Tied to Treasury Bills
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-Through mutual funds, stocks, bonds
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S is covered by a whole life policy. Which insurance product can cover his children?
-Assignment provision
-Payor benefit
-Accelerated benefit rider
-Child term rider
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-Child term rider
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When is the face amount paid under a Joint Life and Survivor policy?
-when policy reaches maturation
-upon death of the first insured
-upon death of the last insured
-when one of the insureds becomes disabled and no longer able to make premium payments
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-upon death of the last insured
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What type of life policy covers two people and pays upon the death of the last insured?
-Shared
-Survivorship
-Adjustable
-Joint
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-Survivorship
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Which of these characteristics is consistent with a Straight Life policy?
-Owner can adjust both premium and death benefit
-Premiums are lower for the first five years, increase the sixth year, then levels off for the remaining length of the contract
-Owner has the option of converting to term insurance
-Premiums are payable for as long as there is insurance coverage in force
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-Premiums are payable for as long as there is insurance coverage in force
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Which is true concerning a Variable Universal Life policy?
-Policyowner controls where the investment will go and selects the amount of the premium payment
-Policyowner has no say where the investment will go but can choose the premium mode
-The investment vehicle for this type of policy is held in the insurer’s general portfolio
-The death benefit can vary but the policyowner has no say in the premium amount paid
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-Policyowner controls where the investment will go and selects the amount of the premium payment
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Which type of life policy contains a monthly mortality charge as well as self-directed investment choices?
-Joint Life
-Adjustable Life
-Variable Universal Life
-Universal Life
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-Variable Universal Life
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A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?
-Straight life accumulates faster than Limited-pay Life
-20-Pay Life accumulates cash value faster than Straight Life
-Cash value accumulation of both 20-Pay Life and Straight Life depend on the insurer’s financial rating
-20-Pay Life and Straight Life accumulate cash value at the same rate
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-20-Pay Life accumulates cash value faster than Straight Life
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Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?
-Modified Whole Life
-Variable Life
-Universal Life
-Adjustable Life
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-Variable Life
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Additional coverage can be added to a Whole Life policy by adding a(n)
-payor rider
-accelerated benefit rider
-decreasing term rider
-automatic premium loan rider
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-decreasing term rider
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