Question 1

Which of the following is True regarding employer sponsored long-term disability insurance?

Accepted Answer

A) Most group plans offer full disability benefits payable to age 65. 
B) Most firms offer employees disability insurance. 
C) Most plans use the 'any occupation' definition after two years of disability. 
D) A typical disability policy covers about 90 percent of the employee's gross salary. 
A) Most group plans offer full disability benefits payable to age 65. 
B) Most firms offer employees disability insurance. 
C) Most plans use the 'any occupation' definition after two years of disability. 
D) A typical disability policy covers about 90 percent of the employee's gross salary.

Question 2

How much insurance would be needed to provide for a family for 20 years if the pre-tax income necessary to cover living expenses is $50 000 and the money can be invested at 6 percent?

Accepted Answer

$50 000 × 11.47 (PVIFA,I = 6%,

Question 3

A lump sum settlement option is usually the best choice,even if a beneficiary is not very good at managing money.

Accepted Answer

A) True 
 B)False

Question 4

A person age 25 to 35 has a greater than 50 percent chance of becoming disabled for longer than three months.

Accepted Answer

A) True 
 B)False

Question 5

Which is True in comparing universal life (UL)insurance and whole life (WL)insurance?

Accepted Answer

A) With WL the cash value is not guaranteed. 
B) With UL you may receive policy dividends. 
C) With WL the premiums are flexible. 
D) With UL the premiums are flexible. 
A) With WL the cash value is not guaranteed. 
B) With UL you may receive policy dividends. 
C) With WL the premiums are flexible. 
D) With UL the premiums are flexible.

Question 6

If used properly,term life insurance can be an effective estate planning tool.

Accepted Answer

A) True 
 B)False

Question 7

Which considerations would be irrelevant when considering whether to cancel an old life insurance policy and start a new one?

Accepted Answer

A) The suicide clause 
B) The premium schedule 
C) The incontestability dates 
D) The grace period 
A) The suicide clause 
B) The premium schedule 
C) The incontestability dates 
D) The grace period

Question 8

Regarding the definition of "disability,"

Accepted Answer

A) the "any occupation" definition is the best one for the insured. 
B) it varies from one disability policy to another and is the most important consideration. 
C) the "own occupation" definition would pay benefits as long as you were not earning income from another occupation. 
D) most employee group insurance uses the regular occupation to age 65 definition. 
A) the "any occupation" definition is the best one for the insured. 
B) it varies from one disability policy to another and is the most important consideration. 
C) the "own occupation" definition would pay benefits as long as you were not earning income from another occupation. 
D) most employee group insurance uses the regular occupation to age 65 definition.

Question 9

Jane and Vitorio are both professionals earning roughly $140 000 each annually.If one of them died and their debts were gone,the survivor could easily live on their own income.They have a combined net worth of $950 000.They have debts in the amount of a $250 000 mortgage and car loans of $85 000.In addition,they pay off their credit cards each month,usually around $21 000.If anything should happen to either one of them,they want to leave their family debt-free.How much life insurance should they consider?

Accepted Answer

A) They should each have a policy for $356 000. 
B) None because their net worth is $950 000. 
C) They should each have a policy for $475 000. 
D) They should each have a policy for $335 000. 
A) They should each have a policy for $356 000. 
B) None because their net worth is $950 000. 
C) They should each have a policy for $475 000. 
D) They should each have a policy for $335 000.

Question 10

The Canada Health Act ensures that all provinces offer the same medical services.

Accepted Answer

A) True 
 B)False

Question 11

Universal life insurance is similar to whole life except it provides less guarantees.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following would be of little concern when calculating the amount of disability insurance needed?

Accepted Answer

A) The cost of one's monthly mortgage payments 
B) One's level of CPP disability coverage 
C) One's employee group disability insurance coverage 
D) One's financial goals 
A) The cost of one's monthly mortgage payments 
B) One's level of CPP disability coverage 
C) One's employee group disability insurance coverage 
D) One's financial goals

Question 13

For long-term care insurance,all else equal,the higher the premium charged,the more comprehensive the coverage.

Accepted Answer

A) True 
 B)False

Question 14

What would be the out-of-pocket cost to an individual whose long-term care policy includes a 20 percent co-insurance clause? A current long-term illness has resulted in total expenses of $250 000.

Accepted Answer

A) $250 000 
B) $200 000 
C) $50 000 
D) $0 
A) $250 000 
B) $200 000 
C) $50 000 
D) $0

Question 15

Additional insurance commonly offered through employers includes

Accepted Answer

A) dental insurance. 
B) critical illness insurance. 
C) liability insurance. 
D) long-term care insurance. 
A) dental insurance. 
B) critical illness insurance. 
C) liability insurance. 
D) long-term care insurance.

Question 16

Critical illness insurance

Accepted Answer

A) is one of the benefits commonly offered in employee group insurance plans. 
B) reimburses you for treatment expenses if you survive a life-altering illness at least 30 days. 
C) pays a lump sum if you survive a life-altering illness listed in the policy for at least 30 days. 
D) pays a lump sum on a list of life-threatening illnesses,with evidence from a physician. 
A) is one of the benefits commonly offered in employee group insurance plans. 
B) reimburses you for treatment expenses if you survive a life-altering illness at least 30 days. 
C) pays a lump sum if you survive a life-altering illness listed in the policy for at least 30 days. 
D) pays a lump sum on a list of life-threatening illnesses,with evidence from a physician.

Question 17

Which of the following is correct regarding long-term care insurance?

Accepted Answer

A) It has an elimination period before owners are eligible to have their long-term care costs covered. 
B) It is relatively inexpensive and good value for those over age 60. 
C) It covers most Canadians over age 65 who receive care due to a long-term health problem. 
D) It offers standard coverage and insurance premiums. 
A) It has an elimination period before owners are eligible to have their long-term care costs covered. 
B) It is relatively inexpensive and good value for those over age 60. 
C) It covers most Canadians over age 65 who receive care due to a long-term health problem. 
D) It offers standard coverage and insurance premiums.

Question 18

If you buy a term insurance policy with a conversion option,this means that you

Accepted Answer

A) can covert the policy to variable life insurance before it terminates. 
B) can convert the amount of coverage by a set amount at the renewal time. 
C) can convert it to a whole life policy before it terminates. 
D) can convert it to a longer term at the renewal time. 
A) can covert the policy to variable life insurance before it terminates. 
B) can convert the amount of coverage by a set amount at the renewal time. 
C) can convert it to a whole life policy before it terminates. 
D) can convert it to a longer term at the renewal time.

Question 19

Whole life insurance has a premium that

Accepted Answer

A) declines. 
B) is variable. 
C) is fixed. 
D) increases. 
A) declines. 
B) is variable. 
C) is fixed. 
D) increases.

Question 20

The income method,basing life insurance needs on multiples of current income,is the most useful method for determining how much life insurance a person should buy.

Accepted Answer

A) True 
 B)False

Which of the following is True regarding employer sponsored long-term disability insurance?

How much insurance would be needed to provide for a family for 20 years if the pre-tax income necessary to cover living expenses is $50 000 and the money can be invested at 6 percent?

A lump sum settlement option is usually the best choice,even if a beneficiary is not very good at managing money.

A person age 25 to 35 has a greater than 50 percent chance of becoming disabled for longer than three months.

Which is True in comparing universal life (UL)insurance and whole life (WL)insurance?

If used properly,term life insurance can be an effective estate planning tool.

Which considerations would be irrelevant when considering whether to cancel an old life insurance policy and start a new one?

Regarding the definition of "disability,"

The Canada Health Act ensures that all provinces offer the same medical services.

Universal life insurance is similar to whole life except it provides less guarantees.

Which of the following would be of little concern when calculating the amount of disability insurance needed?

For long-term care insurance,all else equal,the higher the premium charged,the more comprehensive the coverage.

What would be the out-of-pocket cost to an individual whose long-term care policy includes a 20 percent co-insurance clause? A current long-term illness has resulted in total expenses of $250 000.

Additional insurance commonly offered through employers includes

Critical illness insurance

Which of the following is correct regarding long-term care insurance?

If you buy a term insurance policy with a conversion option,this means that you

Whole life insurance has a premium that

The income method,basing life insurance needs on multiples of current income,is the most useful method for determining how much life insurance a person should buy.

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

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Exam 9: Protecting Your Wealth - Health and Life Insurance

Which of the following is True regarding employer sponsored long-term disability insurance?

How much insurance would be needed to provide for a family for 20 years if the pre-tax income necessary to cover living expenses is $50 000 and the money can be invested at 6 percent?

A lump sum settlement option is usually the best choice,even if a beneficiary is not very good at managing money.

A person age 25 to 35 has a greater than 50 percent chance of becoming disabled for longer than three months.

Which is True in comparing universal life (UL)insurance and whole life (WL)insurance?

If used properly,term life insurance can be an effective estate planning tool.

Which considerations would be irrelevant when considering whether to cancel an old life insurance policy and start a new one?

Regarding the definition of "disability,"

The Canada Health Act ensures that all provinces offer the same medical services.

Universal life insurance is similar to whole life except it provides less guarantees.

Which of the following would be of little concern when calculating the amount of disability insurance needed?

For long-term care insurance,all else equal,the higher the premium charged,the more comprehensive the coverage.

What would be the out-of-pocket cost to an individual whose long-term care policy includes a 20 percent co-insurance clause? A current long-term illness has resulted in total expenses of $250 000.

Additional insurance commonly offered through employers includes

Critical illness insurance

Which of the following is correct regarding long-term care insurance?

If you buy a term insurance policy with a conversion option,this means that you

Whole life insurance has a premium that

The income method,basing life insurance needs on multiples of current income,is the most useful method for determining how much life insurance a person should buy.

Overview of a Financial Plan

Tools for Financial Planning - Applying Time Value Concepts

Tools for Financial Planning - Planning with Personal Financial Statements

Tools for Financial Planning - Using Tax Concepts for Planning

Managing Your Financial Resources - Banking Services and Managing Your Money

Managing Your Financial Resources - Assessing, Managing, and Securing Your Credit

Managing Your Financial Resources - Purchasing and Financing a Home

Protecting Your Wealth - Auto and Homeowner's Insurance

Personal Investing - Investing Fundamentals

Personal Investing - Investing in Stocks

Personal Investing - Investing in Bonds

Personal Investing - Investing in Mutual Funds

Retirement and Estate Planning - Retirement Planning

Retirement and Estate Planning - Estate Planning

Synthesis of Financial Planning - Integrating the Components of a Financial Plan

Filters