Exam 8: Insuring Your Life

The life insurance needs of beneficiaries are secondary since most proceeds are paid to living policyholders.

Paying life insurance premiums on a(n)____ basis will be the most economical.

A young widow will receive Social Security survivor's benefits for her entire life if her husband was covered by Social Security.

The needs approach to determining the amount of life insurance considers

One should avoid buying an annual term life insurance policy that does not have guaranteed renewability.

You want to pay premiums for 20 years and have your insurance premium obligations finished at that time,but you feel you will need life insurance for the rest of your life.You should choose ____ insurance.

Phil,who has enjoyed perfect health throughout his life,has determined that he needs a $1,000,000 30-year level term life insurance policy and is trying to choose the insurance company from which to purchase the policy.He predicts that his family will need the coverage for about 30 years.What should be the most important factor is Phil's decision of which insurance company to use?

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 purest form of life insurance is [whole life | term].

If a life insurance policy pays dividends,it is called:

Universal life insurance is often suitable for single college students since the cost is quite low.

Vicki wants to name her husband,Jamil,as the primary beneficiary on her life insurance policy.Therefore,she should identify the beneficiary as "my husband."

Whole life policies typically provide a high investment rate of return.

The needs approach can determine your life insurance requirements with a single step.

Deciding to sell a motorcycle would be an example of risk sharing.

The needs approach to evaluate the right amount of life insurance is the most accurate method to determine the proper amount of death benefits.

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. -If one wanted to ensure the beneficiary did not outlive the life insurance proceeds,he should select the [fixed-period | fixed amount] option.

The insurance portion of a universal life policy is most analogous to

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 policy owner assumes the investment risk with [whole life | variable life] insurance.

The settlement option chosen by most beneficiaries is

One should be concerned about unethical sales practices when promises are made that premiums will vanish in 3 or 4 years.