Question 1

How much insurance one should carry is an important question for every person who owns or intends to buy life insurance.

Accepted Answer

A) True 
 B)False

Question 2

Which type of life insurance policy continues to grow in popularity,because the policyholder pays the same premium amount for the life of the policy?

Accepted Answer

A) Whole life 
B) Multiyear term life 
C) Decreasing term 
D) Return-of-premium term 
E) Convertible term 
A) Whole life 
B) Multiyear term life 
C) Decreasing term 
D) Return-of-premium term 
E) Convertible term

Question 3

Because the premium payment period for a limited payment policy is shorter than that of a whole life policy,the annual premium is higher.

Accepted Answer

A) True 
 B)False

Question 4

Credit life insurance is used to repay a personal debt should the borrower die before doing so.

Accepted Answer

A) True 
 B)False

Question 5

A plan that insures a large number of persons under the terms of a single policy without requiring medical examinations is called a ________ life insurance policy.

Accepted Answer

A) individual 
B) whole 
C) large number 
D) permanent 
E) group 
A) individual 
B) whole 
C) large number 
D) permanent 
E) group

Question 6

The premium for a whole life policy increases with your age.

Accepted Answer

A) True 
 B)False

Question 7

An important provision in every life insurance policy is the right to name your beneficiary.

Accepted Answer

A) True 
 B)False

Question 8

Industrial life insurance is the most popular form of insurance today.

Accepted Answer

A) True 
 B)False

Question 9

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

Accepted Answer

A) True 
 B)False

Question 10

One of the ten golden rules when buying life insurance is to:

Accepted Answer

A) buy from an unlicensed company. 
B) buy more life insurance than you need. 
C) select an agent who is competent and trustworthy. 
D) ask about higher premium rates for nonsmokers. 
E) not worry about reading and understanding your policy. 
A) buy from an unlicensed company. 
B) buy more life insurance than you need. 
C) select an agent who is competent and trustworthy. 
D) ask about higher premium rates for nonsmokers. 
E) not worry about reading and understanding your policy.

Question 11

Group life and credit life insurance are generally permanent forms of insurance.

Accepted Answer

A) True 
 B)False

Question 12

Using the Multiple of Income Method to estimate insurance needs,what amount of insurance is needed if your current income is $50,000?

Accepted Answer

A) $50,000 
B) $100,000-$200,000 
C) $250,000-$500,000 
D) $500,000-$900,000 
E) over $1,000,000 
A) $50,000 
B) $100,000-$200,000 
C) $250,000-$500,000 
D) $500,000-$900,000 
E) over $1,000,000

Question 13

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

Accepted Answer

A) True 
 B)False

Question 14

The cash values of a ________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

Accepted Answer

A) modified 
B) variable 
C) adjustable 
D) ordinary 
E) temporary 
A) modified 
B) variable 
C) adjustable 
D) ordinary 
E) temporary

Question 15

Some experts claim that credit life insurance policies are:

Accepted Answer

A) the nation's biggest rip-off. 
B) the best buys. 
C) useful for creditors and debtors alike. 
D) less expensive than term life insurance. 
E) an excellent investment. 
A) the nation's biggest rip-off. 
B) the best buys. 
C) useful for creditors and debtors alike. 
D) less expensive than term life insurance. 
E) an excellent investment.

Question 16

Universal life,variable life,and adjustable life are types of term life insurance.

Accepted Answer

A) True 
 B)False

Question 17

The method of determining life insurance requirements that considers factors such as Social Security and your liquid assets is called the:

Accepted Answer

A) easy method. 
B) single-income method. 
C) DINK method. 
D) "nonworking" spouse method. 
E) "family need" method. 
A) easy method. 
B) single-income method. 
C) DINK method. 
D) "nonworking" spouse method. 
E) "family need" method.

Question 18

Life insurance proceeds may be used to provide a retirement income.

Accepted Answer

A) True 
 B)False

Question 19

When comparing Universal Life policies with Whole Life policies,which of the following is typically an advantage of a Universal Life policy?

Accepted Answer

A) Cash value accumulates 
B) You can access cash value only through a policy loan 
C) The policy will lapse if a specific premium is not paid each year 
D) You have control over your outlay 
E) Your premium cannot be changed 
A) Cash value accumulates 
B) You can access cash value only through a policy loan 
C) The policy will lapse if a specific premium is not paid each year 
D) You have control over your outlay 
E) Your premium cannot be changed

Question 20

Which statement is false regarding switching policies?

Accepted Answer

A) An author noted that half of those who buy whole or universal life drop them within 10 years. 
B) The insurance industry is regulated by state insurance commissioners. 
C) Your need for life insurance coverage will change over time. 
D) A new life insurance policy will cost more as you get older. 
E) You will always be insurable if you switch policies. 
A) An author noted that half of those who buy whole or universal life drop them within 10 years. 
B) The insurance industry is regulated by state insurance commissioners. 
C) Your need for life insurance coverage will change over time. 
D) A new life insurance policy will cost more as you get older. 
E) You will always be insurable if you switch policies.

How much insurance one should carry is an important question for every person who owns or intends to buy life insurance.

Which type of life insurance policy continues to grow in popularity,because the policyholder pays the same premium amount for the life of the policy?

Because the premium payment period for a limited payment policy is shorter than that of a whole life policy,the annual premium is higher.

Credit life insurance is used to repay a personal debt should the borrower die before doing so.

A plan that insures a large number of persons under the terms of a single policy without requiring medical examinations is called a ________ life insurance policy.

The premium for a whole life policy increases with your age.

An important provision in every life insurance policy is the right to name your beneficiary.

Industrial life insurance is the most popular form of insurance today.

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

One of the ten golden rules when buying life insurance is to:

Group life and credit life insurance are generally permanent forms of insurance.

Using the Multiple of Income Method to estimate insurance needs,what amount of insurance is needed if your current income is $50,000?

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

The cash values of a ________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

Some experts claim that credit life insurance policies are:

Universal life,variable life,and adjustable life are types of term life insurance.

The method of determining life insurance requirements that considers factors such as Social Security and your liquid assets is called the:

Life insurance proceeds may be used to provide a retirement income.

When comparing Universal Life policies with Whole Life policies,which of the following is typically an advantage of a Universal Life policy?

Which statement is false regarding switching policies?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

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Exam 12: Life Insurance

How much insurance one should carry is an important question for every person who owns or intends to buy life insurance.

Which type of life insurance policy continues to grow in popularity,because the policyholder pays the same premium amount for the life of the policy?

Because the premium payment period for a limited payment policy is shorter than that of a whole life policy,the annual premium is higher.

Credit life insurance is used to repay a personal debt should the borrower die before doing so.

A plan that insures a large number of persons under the terms of a single policy without requiring medical examinations is called a ________ life insurance policy.

The premium for a whole life policy increases with your age.

An important provision in every life insurance policy is the right to name your beneficiary.

Industrial life insurance is the most popular form of insurance today.

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

One of the ten golden rules when buying life insurance is to:

Group life and credit life insurance are generally permanent forms of insurance.

Using the Multiple of Income Method to estimate insurance needs,what amount of insurance is needed if your current income is $50,000?

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

The cash values of a ________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

Some experts claim that credit life insurance policies are:

Universal life,variable life,and adjustable life are types of term life insurance.

The method of determining life insurance requirements that considers factors such as Social Security and your liquid assets is called the:

Life insurance proceeds may be used to provide a retirement income.

When comparing Universal Life policies with Whole Life policies,which of the following is typically an advantage of a Universal Life policy?

Which statement is false regarding switching policies?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: the Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health,disability,and Long-Term Care Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters