Question 1

Guaranteed renewable term insurance allows you to renew a policy for another term without qualifying medically.

Accepted Answer

A) True 
 B)False

Question 2

_____ involves abstaining from any activity that will affect an individual financially.

Accepted Answer

A) Risk avoidance 
B) Loss prevention 
C) Loss control 
D) Risk assumption 
E) Premium collection 
A) Risk avoidance 
B) Loss prevention 
C) Loss control 
D) Risk assumption 
E) Premium collection

Question 3

If you have a high-risk hobby, then you could be required to pay more for life insurance than others pay.

Accepted Answer

A) True 
 B)False

Question 4

Insurance underwriting is best described as:

Accepted Answer

A) the process used by insurers to decide who can be insured and to determine applicable rates that will be charged for premiums. 
B) a set of activities used to identify the risk and rewards of investing an insured's funds on marketable securities. 
C) production-related activities performed primarily by agents on the field. 
D) a process of developing taxing structures for insurance policies. 
E) a function most often performed by an actuary. 
A) the process used by insurers to decide who can be insured and to determine applicable rates that will be charged for premiums. 
B) a set of activities used to identify the risk and rewards of investing an insured's funds on marketable securities. 
C) production-related activities performed primarily by agents on the field. 
D) a process of developing taxing structures for insurance policies. 
E) a function most often performed by an actuary.

Question 5

The _____ method is the most detailed method of determining the amount of life insurance coverage needed for an individual.

Accepted Answer

A) human life value 
B) multiple-of-earnings 
C) risk assessment 
D) economic identification 
E) needs analysis 
A) human life value 
B) multiple-of-earnings 
C) risk assessment 
D) economic identification 
E) needs analysis

Question 6

A(n)_____ policy is a type of term insurance.

Accepted Answer

A) straight term 
B) whole life 
C) increasing term 
D) variable term 
E) risk assumption 
A) straight term 
B) whole life 
C) increasing term 
D) variable term 
E) risk assumption

Question 7

Underwriting refers to:

Accepted Answer

A) selling insurance at a premium less than that of the competitors. 
B) the payment of a claim. 
C) a method for developing policy wording. 
D) the determination of which exposures to insure. 
E) restoring the claimant to the financial condition prior to loss. 
A) selling insurance at a premium less than that of the competitors. 
B) the payment of a claim. 
C) a method for developing policy wording. 
D) the determination of which exposures to insure. 
E) restoring the claimant to the financial condition prior to loss.

Question 8

Avoiding alcoholic beverages while driving is an example of loss prevention.

Accepted Answer

A) True 
 B)False

Question 9

Universal life insurance is:

Accepted Answer

A) a deferred premium payment policy. 
B) primarily sold to college students. 
C) a combined savings\investment plan and insurance policy. 
D) a provision for a secondary beneficiary. 
E) less expensive than other policy types. 
A) a deferred premium payment policy. 
B) primarily sold to college students. 
C) a combined savings\investment plan and insurance policy. 
D) a provision for a secondary beneficiary. 
E) less expensive than other policy types.

Question 10

Which of the following statements regarding insurance underwriting is true?

Accepted Answer

A) Insurance underwriters perform any activity that reduces the chance that a loss will occur. 
B) Insurance underwriters perform a process used to avoid an act that would create a risk. 
C) Insurance underwriters help insurers determine the insurance needs of the potential insured. 
D) Insurance underwriters lessen the severity of loss after it occurs. 
E) Insurance underwriters design rate classification schedules so that people pay premiums that reflect their chance of loss. 
A) Insurance underwriters perform any activity that reduces the chance that a loss will occur. 
B) Insurance underwriters perform a process used to avoid an act that would create a risk. 
C) Insurance underwriters help insurers determine the insurance needs of the potential insured. 
D) Insurance underwriters lessen the severity of loss after it occurs. 
E) Insurance underwriters design rate classification schedules so that people pay premiums that reflect their chance of loss.

Question 11

The basic purpose of insurance is to:

Accepted Answer

A) protect the health of you and your family. 
B) protect you and your family from economic losses. 
C) supplement the income of you and your family. 
D) shield you and your family from bad decisions. 
E) protect you and your family from nonfinancial losses. 
A) protect the health of you and your family. 
B) protect you and your family from economic losses. 
C) supplement the income of you and your family. 
D) shield you and your family from bad decisions. 
E) protect you and your family from nonfinancial losses.

Question 12

Group life insurance is a(n):

Accepted Answer

A) term policy designed to pay off the mortgage balance in the event of the borrower's death. 
B) insurance that is sold in conjunction with the sale of a group of assets. 
C) insurance in which benefits are a function of the returns being generated on the investments selected by the policyholder. 
D) insurance that provides a master policy for a group. 
E) insurance that issues many master policies for an insured. 
A) term policy designed to pay off the mortgage balance in the event of the borrower's death. 
B) insurance that is sold in conjunction with the sale of a group of assets. 
C) insurance in which benefits are a function of the returns being generated on the investments selected by the policyholder. 
D) insurance that provides a master policy for a group. 
E) insurance that issues many master policies for an insured.

Question 13

Which of the following represents a disadvantage of a whole life insurance policy?

Accepted Answer

A) It is difficult to evaluate the true cost of a whole life insurance policy at the time of purchase. 
B) A whole life insurance policy provides only temporary coverage for a set period. 
C) A whole life insurance policy may require a policyholder to pay higher premiums when the policy is renewed. 
D) A whole life insurance policy often provides lower yields than other investment vehicles. 
E) A whole life insurance policy does not provide any tax advantages on accumulated earnings. 
A) It is difficult to evaluate the true cost of a whole life insurance policy at the time of purchase. 
B) A whole life insurance policy provides only temporary coverage for a set period. 
C) A whole life insurance policy may require a policyholder to pay higher premiums when the policy is renewed. 
D) A whole life insurance policy often provides lower yields than other investment vehicles. 
E) A whole life insurance policy does not provide any tax advantages on accumulated earnings.

Question 14

Which of the following policy features allows the insured to increase coverage periodically without showing proof of insurability?

Accepted Answer

A) Multiple indemnity clause 
B) Guaranteed purchase option 
C) Disability clause 
D) Paid-up insurance option 
E) Extended-term option 
A) Multiple indemnity clause 
B) Guaranteed purchase option 
C) Disability clause 
D) Paid-up insurance option 
E) Extended-term option

Guaranteed renewable term insurance allows you to renew a policy for another term without qualifying medically.

_____ involves abstaining from any activity that will affect an individual financially.

If you have a high-risk hobby, then you could be required to pay more for life insurance than others pay.

Insurance underwriting is best described as:

The _____ method is the most detailed method of determining the amount of life insurance coverage needed for an individual.

A(n)_____ policy is a type of term insurance.

Underwriting refers to:

Avoiding alcoholic beverages while driving is an example of loss prevention.

Universal life insurance is:

Which of the following statements regarding insurance underwriting is true?

The basic purpose of insurance is to:

Group life insurance is a(n):

Which of the following represents a disadvantage of a whole life insurance policy?

Which of the following policy features allows the insured to increase coverage periodically without showing proof of insurability?

Understanding the Financial Process

Using Financial Statements and Budgets

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, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

Exam 8: Insuring Your Life

Guaranteed renewable term insurance allows you to renew a policy for another term without qualifying medically.

_____ involves abstaining from any activity that will affect an individual financially.

If you have a high-risk hobby, then you could be required to pay more for life insurance than others pay.

Insurance underwriting is best described as:

The _____ method is the most detailed method of determining the amount of life insurance coverage needed for an individual.

A(n)_____ policy is a type of term insurance.

Underwriting refers to:

Avoiding alcoholic beverages while driving is an example of loss prevention.

Universal life insurance is:

Which of the following statements regarding insurance underwriting is true?

The basic purpose of insurance is to:

Group life insurance is a(n):

Which of the following represents a disadvantage of a whole life insurance policy?

Which of the following policy features allows the insured to increase coverage periodically without showing proof of insurability?

Understanding the Financial Process

Using Financial Statements and Budgets

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, Etfs, and Real Estate

Planning for Retirement

Preserving Your Estate

Filters