A factor that can be ignored when determining the cost of life insurance is A) time value of money. B) premiums paid. C) settlement options. D) dividends. ANSWER Answer: C
Date: September 19th, 2020
Jane purchased a life insurance policy on her own life and named her daughter, Cheryl, as beneficiary. Cheryl has a history of not managing money well. Jane wants the death benefit paid to Cheryl in monthly installments over 20 years. Which settlement option should Jane pre-select for Cheryl? A) lump sum B) fixed amount C) […]
Date: September 19th, 2020
Which of the following statements about the Linton yield is (are) true? I. It is based on the assumption that a cash-value policy can be viewed as a combination of insurance protection and a savings fund. II. It is the average compound annual rate of return required to make the savings deposits in a life […]
Date: September 19th, 2020
Which of the following statements is (are) true concerning settlement options? I. A straight life annuity provides the lowest amount of periodic income of all the life income options. II. Fixed-period and fixed-amount are life income options. A) I only B) II only C) both I and II D) neither I nor II […]
Date: September 19th, 2020
Which of the following statements about the guaranteed purchase option is true? A) An insured usually has 24 months to exercise an option. B) The option cannot be exercised until the insured reaches age 40. C) The amount of life insurance that can be purchased at each option is limited to 10 percent of the […]
Date: September 19th, 2020
Which of the following statements about the waiver-of-premium provision in life insurance is true? A) Because the probability of becoming disabled exceeds the probability of premature death, the cost to include this provision is usually prohibitive at younger ages. B) Premiums are usually waived if the insured becomes partially disabled. C) Life insurance protection continues […]
Date: September 19th, 2020
All of the following are requirements that must be satisfied before premiums are waived under a waiver-of-premium provision EXCEPT A) The insured must furnish proof of disability to the insurer. B) The insured must be disabled before some specified age, such as age 60 or 65. C) The insured must satisfy the definition of disability. […]
Date: September 19th, 2020
The cost-of-living rider typically bases increases in the policy face value on changes in the A) gross national product. B) interest rate for short-term U.S. government securities. C) consumer price index. D) national wage level. ANSWER Answer: C
Date: September 19th, 2020
Which of the following statements about accelerated death benefits riders is (are) true? I. The benefit paid is usually less than the full face amount. II. Several different medical conditions may trigger the payment of benefits. A) I only B) II only C) both I and II D) neither I nor II ANSWER […]
Date: September 19th, 2020
The practice of buying the life insurance policy of a terminally ill insured at a discount is referred to as a A) collateral assignment. B) viatical settlement. C) catastrophic illness conversion. D) grace period transaction. ANSWER Answer: B
Date: September 19th, 2020
