Question 1

The premiums on a five-year level-premium,guaranteed renewable term policy would increase annually.

Accepted Answer

A) True 
 B)False

Question 2

Variations on term life insurance include

Accepted Answer

A) adjustable life. 
B) universal life. 
C) credit life. 
D) modified life. 
A) adjustable life. 
B) universal life. 
C) credit life. 
D) modified life.

Question 3

Cash dividends are paid only on cash-value life insurance policies.

Accepted Answer

A) True 
 B)False

Question 4

Antonio and Trina are a young couple with two small children, Jason (age four) and Claudia (age two). Trina is an account executive for a brokerage firm while Antonio has taken a couple years off from his profession as a civil engineer to work on an MBA degree. Right now Antonio and Trina's budget is very tight, as they are accustomed to living on two incomes, but Trina's employer has just circulated employer benefit information, so Antonio and Trina believe this is a good time to evaluate their life insurance needs. They have listed the financial information they believe is relevant.
  
-Trina enjoys managing investments and believes that she could get a higher yield on the proceeds from Antonio's life insurance than the insurance company would pay.Which settlement option should be selected for Antonio's policy in the event of his death?

Accepted Answer

A) Interest income 
B) Lump sum 
C) Income for a specific period 
D) Income for life 
A) Interest income 
B) Lump sum 
C) Income for a specific period 
D) Income for life

Question 5

The primary reason for buying life insurance is to obtain a high-quality investment.

Accepted Answer

A) True 
 B)False

Question 6

Whole life insurance is a form of cash-value life insurance that provides lifetime insurance protection and expects you to pay premiums for life.

Accepted Answer

A) True 
 B)False

Question 7

Adjustable life insurance allows you to change ____ on your policy.

Accepted Answer

A) the premium 
B) the face amount 
C) the rate of cash-value accumulation 
D) any of these 
A) the premium 
B) the face amount 
C) the rate of cash-value accumulation 
D) any of these

Question 8

Endorsements are amendments and additions to the basic insurance policy.​

Accepted Answer

A) True 
 B)False

Question 9

Your need for life insurance will change significantly over the course of your life cycle.

Accepted Answer

A) True 
 B)False

Question 10

The purpose of life insurance is to protect the person on whose life an insurance policy is issued.

Accepted Answer

A) True 
 B)False

Question 11

A single-premium life insurance policy is an extreme form of a limited-pay life policy.

Accepted Answer

A) True 
 B)False

Question 12

Term life insurance costs far more than cash-value life insurance.

Accepted Answer

A) True 
 B)False

Question 13

Credit term life insurance is generally more expensive per dollar of coverage than similar types of term insurance.

Accepted Answer

A) True 
 B)False

Question 14

The annual premiums for limited-pay policies are lower than those for whole-life policies,other factors being equal.

Accepted Answer

A) True 
 B)False

Question 15

Shelly $125,000 cash-value policy has a cash value of $18,000.If Shelly dies,her beneficiary receives ____.If she does not die but decides to cancel the policy,Shelly will receive ____.

Accepted Answer

A) $125,000; $18,000 
B) $125,000; $0 
C) $143,000; $18,000 
D) $107,000; $18,000 
A) $125,000; $18,000 
B) $125,000; $0 
C) $143,000; $18,000 
D) $107,000; $18,000

Question 16

A surrender charge is a tax owed the government on the amount withdrawn from the cash value accumulated on a life insurance policy.

Accepted Answer

A) True 
 B)False

Question 17

At the end of year 5,Allison could

Accepted Answer

A) pay nothing more in premiums and collect $100,000 in 6 years and 142 days. 
B) pay nothing more in premiums and have $7,950 paid-up insurance the rest of her life. 
C) cancel the policy and collect $7,950. 
D) cancel the policy and collect $14,450. 
A) pay nothing more in premiums and collect $100,000 in 6 years and 142 days. 
B) pay nothing more in premiums and have $7,950 paid-up insurance the rest of her life. 
C) cancel the policy and collect $7,950. 
D) cancel the policy and collect $14,450.

Question 18

With a universal life policy,the current rate of return is paid on total premiums paid into the policy.

Accepted Answer

A) True 
 B)False

Question 19

The major financial loss resulting from premature death is the

Accepted Answer

A) readjustment-period expenses. 
B) lost income of the deceased. 
C) necessary final expenses. 
D) debt-repayment expenses. 
A) readjustment-period expenses. 
B) lost income of the deceased. 
C) necessary final expenses. 
D) debt-repayment expenses.

Question 20

Amounts stipulated in a life insurance policy that protect the cash value in the event that the policyholder chooses not to pay the required premiums are

Accepted Answer

A) nonforfeiture values. 
B) cash surrender values. 
C) forced savings. 
D) cash value. 
A) nonforfeiture values. 
B) cash surrender values. 
C) forced savings. 
D) cash value.

The premiums on a five-year level-premium,guaranteed renewable term policy would increase annually.

Variations on term life insurance include

Cash dividends are paid only on cash-value life insurance policies.

The primary reason for buying life insurance is to obtain a high-quality investment.

Whole life insurance is a form of cash-value life insurance that provides lifetime insurance protection and expects you to pay premiums for life.

Adjustable life insurance allows you to change ____ on your policy.

Endorsements are amendments and additions to the basic insurance policy.

Your need for life insurance will change significantly over the course of your life cycle.

The purpose of life insurance is to protect the person on whose life an insurance policy is issued.

A single-premium life insurance policy is an extreme form of a limited-pay life policy.

Term life insurance costs far more than cash-value life insurance.

Credit term life insurance is generally more expensive per dollar of coverage than similar types of term insurance.

The annual premiums for limited-pay policies are lower than those for whole-life policies,other factors being equal.

Shelly $125,000 cash-value policy has a cash value of $18,000.If Shelly dies,her beneficiary receives .If she does not die but decides to cancel the policy,Shelly will receive .

A surrender charge is a tax owed the government on the amount withdrawn from the cash value accumulated on a life insurance policy.

At the end of year 5,Allison could

With a universal life policy,the current rate of return is paid on total premiums paid into the policy.

The major financial loss resulting from premature death is the

Amounts stipulated in a life insurance policy that protect the cash value in the event that the policyholder chooses not to pay the required premiums are

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Investment Fundamentals

Investing in Stocks and Bonds

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters

Exam 12: Life Insurance Planning

The premiums on a five-year level-premium,guaranteed renewable term policy would increase annually.

Variations on term life insurance include

Cash dividends are paid only on cash-value life insurance policies.

The primary reason for buying life insurance is to obtain a high-quality investment.

Whole life insurance is a form of cash-value life insurance that provides lifetime insurance protection and expects you to pay premiums for life.

Adjustable life insurance allows you to change ____ on your policy.

Endorsements are amendments and additions to the basic insurance policy.​

Your need for life insurance will change significantly over the course of your life cycle.

The purpose of life insurance is to protect the person on whose life an insurance policy is issued.

A single-premium life insurance policy is an extreme form of a limited-pay life policy.

Term life insurance costs far more than cash-value life insurance.

Credit term life insurance is generally more expensive per dollar of coverage than similar types of term insurance.

The annual premiums for limited-pay policies are lower than those for whole-life policies,other factors being equal.

Shelly $125,000 cash-value policy has a cash value of $18,000.If Shelly dies,her beneficiary receives ____.If she does not die but decides to cancel the policy,Shelly will receive ____.

A surrender charge is a tax owed the government on the amount withdrawn from the cash value accumulated on a life insurance policy.

At the end of year 5,Allison could

With a universal life policy,the current rate of return is paid on total premiums paid into the policy.

The major financial loss resulting from premature death is the

Amounts stipulated in a life insurance policy that protect the cash value in the event that the policyholder chooses not to pay the required premiums are

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Investment Fundamentals

Investing in Stocks and Bonds

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters

Endorsements are amendments and additions to the basic insurance policy.

Shelly $125,000 cash-value policy has a cash value of $18,000.If Shelly dies,her beneficiary receives .If she does not die but decides to cancel the policy,Shelly will receive .