Exam 8: Insuring Your Life

The need for additional life insurance can be determined by looking at the difference between available resources and family monetary needs.

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. -With traditional whole life policies sold by an agent,sales commissions and marketing expenses account for at least [20% | 50%] of total premiums paid over the life of the policy.

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. -In order to predict accurately the number of losses that will occur in a given time,insurance companies must study [large | small] numbers of cases.

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

Underwriters can predict whether or not you will suffer a loss this year.

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. -Group insurance is most likely to be [term | whole life].

Generally,the period-certain settlement option is desirable because life insurance companies pay higher than average interest rates.

Individually owned life insurance premiums are generally tax deductible.

The basic purpose of insurance is to

Life insurance needs change dramatically over one's lifetime.

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. -Insurance is a tool that can lessen [economic | accident] risk.

A variable life policy combines life insurance coverage with tax-favored investment options.

____ and ____ are both relatively expensive types of decreasing-term life insurance.

Decreasing term insurance usually has a decreasing face value and

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. -Annual premiums would be lower with [continuous | limited payment] whole life insurance.

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.

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