Question 1

Universal life insurance does not vary from one insurance company to another and is, therefore, the most common and popular form of life insurance.

Accepted Answer

A) True 
 B)False

Question 2

If the premium on a term insurance policy is not paid by the due date, which of the following is true?

Accepted Answer

A)  The policy is immediately terminated. 
B)  The death benefit of the policy is reduced by the amount of the premium owed. 
C)  The premium will be deducted from the cash value of the policy. 
D)  The policyholder is given a grace period to pay after which the policy will be terminated if the premium is not paid. 
A)  The policy is immediately terminated. 
B)  The death benefit of the policy is reduced by the amount of the premium owed. 
C)  The premium will be deducted from the cash value of the policy. 
D)  The policyholder is given a grace period to pay after which the policy will be terminated if the premium is not paid.

Question 3

Life insurance may be obtained through all of the following, except

Accepted Answer

A)  financial institutions. 
B)  private insurance companies. 
C)  the federal government. 
D)  your employer. 
A)  financial institutions. 
B)  private insurance companies. 
C)  the federal government. 
D)  your employer.

Question 4

Of the following statements dealing with premiums on life insurance, which is not true?

Accepted Answer

A)  Some factors that affect premiums are decided at birth. 
B)  Premiums will be higher if you buy insurance when you are older. 
C)  The kind of policy you buy will determine your premiums. 
D)  There are very few things you can do to reduce your life insurance premiums. 
A)  Some factors that affect premiums are decided at birth. 
B)  Premiums will be higher if you buy insurance when you are older. 
C)  The kind of policy you buy will determine your premiums. 
D)  There are very few things you can do to reduce your life insurance premiums.

Question 5

A disadvantage of variable life policies is that the cash value may actually decrease in value if stocks or other investments decline.

Accepted Answer

A) True 
 B)False

Question 6

________ life insurance can only be by used to pay off a home in the event of the policyholder's death.

Accepted Answer

A)  Mortgage 
B)  Decreasing-term 
C)  Universal life 
D)  Homeowner 
A)  Mortgage 
B)  Decreasing-term 
C)  Universal life 
D)  Homeowner

Question 7

One advantage of whole life insurance over term life insurance is

Accepted Answer

A)  premiums are not affected by age. 
B)  whole life insurance forces people to save money. 
C)  whole life insurance is less expensive than term life. 
D)  whole life does not build cash value while term life does. 
A)  premiums are not affected by age. 
B)  whole life insurance forces people to save money. 
C)  whole life insurance is less expensive than term life. 
D)  whole life does not build cash value while term life does.

Question 8

How much term life insurance should you have to provide your family with $75,000 per year pretax for general expenses for 40 years, plus immediately pre-fund two $100,000 college accounts for your two children in the event of your death. Assume your death benefit could be invested at 6% per year for the entire period.

Accepted Answer

A)  $1,200,000 
B)  $1,357,000 
C)  $1,328,472 
D)  Not enough information to determine the answer 
A)  $1,200,000 
B)  $1,357,000 
C)  $1,328,472 
D)  Not enough information to determine the answer

Question 9

The primary reason a person would buy life insurance is to eliminate or substantially reduce the financial consequences of that person's death by providing financial support to his or her dependents.

Accepted Answer

A) True 
 B)False

Question 10

Which of the following statements is false concerning term life insurance?

Accepted Answer

A)  The premiums increase as you renew the policy. 
B)  It will expire and be of no value if not renewed. 
C)  It has a cash value or savings feature as long as you keep the policy active. 
D)  It provides the same amount of cash to a beneficiary as whole life policies. 
A)  The premiums increase as you renew the policy. 
B)  It will expire and be of no value if not renewed. 
C)  It has a cash value or savings feature as long as you keep the policy active. 
D)  It provides the same amount of cash to a beneficiary as whole life policies.

Question 11

In using the Internet to price insurance, which of the following is not true?

Accepted Answer

A)  It is fast and convenient. 
B)  It is usually more expensive. 
C)  There is less pressure. 
D)  You can compare rates among several companies at once. 
A)  It is fast and convenient. 
B)  It is usually more expensive. 
C)  There is less pressure. 
D)  You can compare rates among several companies at once.

Question 12

Use the following two columns of items to answer the matching questions below:
-universal life insurance
A)cash value and benefits to the beneficiary
B)combination of term insurance and a savings plan
C)premiums constant with reduced benefits
D)term insurance with a variable investment portion

Accepted Answer

The answer of Use the following two columns of items...

Question 13

A disadvantage of term insurance is that

Accepted Answer

A)  it becomes more expensive when you renew it. 
B)  the cash value portion of the premium is larger than other forms. 
C)  you can only exchange your cash value for other insurance. 
D)  it is expensive early in life when you need it the most. 
A)  it becomes more expensive when you renew it. 
B)  the cash value portion of the premium is larger than other forms. 
C)  you can only exchange your cash value for other insurance. 
D)  it is expensive early in life when you need it the most.

Question 14

Term insurance will provide most of a young family's life insurance coverage due to its affordable cost.

Accepted Answer

A) True 
 B)False

Universal life insurance does not vary from one insurance company to another and is, therefore, the most common and popular form of life insurance.

If the premium on a term insurance policy is not paid by the due date, which of the following is true?

Life insurance may be obtained through all of the following, except

Of the following statements dealing with premiums on life insurance, which is not true?

A disadvantage of variable life policies is that the cash value may actually decrease in value if stocks or other investments decline.

________ life insurance can only be by used to pay off a home in the event of the policyholder's death.

One advantage of whole life insurance over term life insurance is

The primary reason a person would buy life insurance is to eliminate or substantially reduce the financial consequences of that person's death by providing financial support to his or her dependents.

Which of the following statements is false concerning term life insurance?

In using the Internet to price insurance, which of the following is not true?

Use the following two columns of items to answer the matching questions below: -universal life insurance A)cash value and benefits to the beneficiary B)combination of term insurance and a savings plan C)premiums constant with reduced benefits D)term insurance with a variable investment portion

A disadvantage of term insurance is that

Term insurance will provide most of a young family's life insurance coverage due to its affordable cost.

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters

Exam 13: Life Insurance

Universal life insurance does not vary from one insurance company to another and is, therefore, the most common and popular form of life insurance.

If the premium on a term insurance policy is not paid by the due date, which of the following is true?

Life insurance may be obtained through all of the following, except

Of the following statements dealing with premiums on life insurance, which is not true?

A disadvantage of variable life policies is that the cash value may actually decrease in value if stocks or other investments decline.

________ life insurance can only be by used to pay off a home in the event of the policyholder's death.

One advantage of whole life insurance over term life insurance is

The primary reason a person would buy life insurance is to eliminate or substantially reduce the financial consequences of that person's death by providing financial support to his or her dependents.

Which of the following statements is false concerning term life insurance?

In using the Internet to price insurance, which of the following is not true?

Use the following two columns of items to answer the matching questions below: -universal life insurance A)cash value and benefits to the beneficiary B)combination of term insurance and a savings plan C)premiums constant with reduced benefits D)term insurance with a variable investment portion

A disadvantage of term insurance is that

Term insurance will provide most of a young family's life insurance coverage due to its affordable cost.

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

Filters