Question 1

Lump-sum distributions of death benefits are generally excluded from federal income tax.

Accepted Answer

A) True 
 B)False

Question 2

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-The most accurate way to determine how much life insurance you need is to use the [multiple earnings | needs] approach.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 3

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-An activity that reduces the chance that a loss will occur is [risk shifting | loss prevention].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 4

The purchase of insurance is a common form of which risk management technique:

Accepted Answer

A)  risk retention 
B)  risk transfer 
C)  risk assumption 
D)  risk avoidance 
E)  loss control 
A)  risk retention 
B)  risk transfer 
C)  risk assumption 
D)  risk avoidance 
E)  loss control

Question 5

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-[Joint life | Survivorship life] insurance is often used to provide funds to pay estate taxes.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 6

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-You can learn about the financial strength of an insurance company by checking Best's Insurance Reports and [the SEC | Standard and Poor's] rating system.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 7

Group life insurance is often provided as a fringe benefit by employers.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following companies does NOT rate the financial strength of life insurance companies?

Accepted Answer

A)  A.M.Best 
B)  Moody's 
C)  Duff & Phelps 
D)  Weiss 
E)  Welch's 
A)  A.M.Best 
B)  Moody's 
C)  Duff & Phelps 
D)  Weiss 
E)  Welch's

Question 9

An insured usually chooses variable life insurance in order to

Accepted Answer

A)  provide more flexible coverage. 
B)  emphasize the savings portion while still having death protection. 
C)  lessen the savings feature of life insurance. 
D)  substitute for fixed-dollar insurance protection. 
E)  reduce insurance premiums. 
A)  provide more flexible coverage. 
B)  emphasize the savings portion while still having death protection. 
C)  lessen the savings feature of life insurance. 
D)  substitute for fixed-dollar insurance protection. 
E)  reduce insurance premiums.

Question 10

The right of the policyholder to the cash value of a whole life policy is a nonforfeiture right.

Accepted Answer

A) True 
 B)False

Question 11

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Credit life insurance is generally considered to be a [good | poor] life insurance buy.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 12

Life insurance cash value may be collected by terminating the policy.

Accepted Answer

A) True 
 B)False

Question 13

Individually owned life insurance premiums are generally tax deductible.

Accepted Answer

A) True 
 B)False

Question 14

Life insurance death benefits are not subject to income taxes.

Accepted Answer

A) True 
 B)False

Question 15

One should typically name both primary and contingent beneficiaries for life insurance policies.

Accepted Answer

A) True 
 B)False

Question 16

Having a fire extinguisher in your home is an example of loss prevention.

Accepted Answer

A) True 
 B)False

Question 17

From the standpoint of the person buying insurance,the central purpose of insurance should be:

Accepted Answer

A)  to collect for all accidental losses 
B)  to transfer risks of serious losses 
C)  to support the prevention of losses 
D)  to accumulate savings 
E)  to reduce payments for the most frequently occurring losses 
A)  to collect for all accidental losses 
B)  to transfer risks of serious losses 
C)  to support the prevention of losses 
D)  to accumulate savings 
E)  to reduce payments for the most frequently occurring losses

Question 18

The basic purpose of insurance is to protect you from the results of accidental losses.

Accepted Answer

A) True 
 B)False

Question 19

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Accepted Answer

A) True 
 B)False

Question 20

Insurance company underwriters determine whom it can insure and what rating-class is appropriate.

Accepted Answer

A) True 
 B)False

Lump-sum distributions of death benefits are generally excluded from federal income tax.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -An activity that reduces the chance that a loss will occur is [risk shifting | loss prevention].

The purchase of insurance is a common form of which risk management technique:

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -[Joint life | Survivorship life] insurance is often used to provide funds to pay estate taxes.

Group life insurance is often provided as a fringe benefit by employers.

Which of the following companies does NOT rate the financial strength of life insurance companies?

An insured usually chooses variable life insurance in order to

The right of the policyholder to the cash value of a whole life policy is a nonforfeiture right.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Credit life insurance is generally considered to be a [good | poor] life insurance buy.

Life insurance cash value may be collected by terminating the policy.

Individually owned life insurance premiums are generally tax deductible.

Life insurance death benefits are not subject to income taxes.

One should typically name both primary and contingent beneficiaries for life insurance policies.

Having a fire extinguisher in your home is an example of loss prevention.

From the standpoint of the person buying insurance,the central purpose of insurance should be:

The basic purpose of insurance is to protect you from the results of accidental losses.

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Insurance company underwriters determine whom it can insure and what rating-class is appropriate.

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

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Exam 8: Insuring Your Life

Lump-sum distributions of death benefits are generally excluded from federal income tax.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -An activity that reduces the chance that a loss will occur is [risk shifting | loss prevention].

The purchase of insurance is a common form of which risk management technique:

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -[Joint life | Survivorship life] insurance is often used to provide funds to pay estate taxes.

Group life insurance is often provided as a fringe benefit by employers.

Which of the following companies does NOT rate the financial strength of life insurance companies?

An insured usually chooses variable life insurance in order to

The right of the policyholder to the cash value of a whole life policy is a nonforfeiture right.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -Credit life insurance is generally considered to be a [good | poor] life insurance buy.

Life insurance cash value may be collected by terminating the policy.

Individually owned life insurance premiums are generally tax deductible.

Life insurance death benefits are not subject to income taxes.

One should typically name both primary and contingent beneficiaries for life insurance policies.

Having a fire extinguisher in your home is an example of loss prevention.

From the standpoint of the person buying insurance,the central purpose of insurance should be:

The basic purpose of insurance is to protect you from the results of accidental losses.

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Insurance company underwriters determine whom it can insure and what rating-class is appropriate.

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters