Question 1

Which of the following life insurance policies would have the lowest premium for a male age 40?

Accepted Answer

A)  Level term 
B)  Whole life continuous premium 
C)  Whole life paid up at 45 
D)  Variable life 
A)  Level term 
B)  Whole life continuous premium 
C)  Whole life paid up at 45 
D)  Variable life

Question 2

There is more Individual Life Insurance Coverage in the United States compared to Group Life Insurance Coverage.

Accepted Answer

A) True 
 B)False

Question 3

Regarding variable life insurance, all of the following are true except:

Accepted Answer

A)  provides no mortality or investment guarantees 
B)  has flexible benefits based on investment returns 
C)  allows the insured to choose how the cash value is invested 
D)  is transparent with respect to costs and returns 
A)  provides no mortality or investment guarantees 
B)  has flexible benefits based on investment returns 
C)  allows the insured to choose how the cash value is invested 
D)  is transparent with respect to costs and returns

Question 4

In a limited payment policy, only a portion of the face amount is paid if death occurs in the early years.

Accepted Answer

A) True 
 B)False

Question 5

Credit life insurance is:

Accepted Answer

A)  a group life program designed specifically for employees who work in manufacturing 
B)  commercial insurance sold in large amounts for key man life insurance 
C)  purchased by a lender 
D)  sold to employees who work in high-risk industrial manufacturing jobs 
A)  a group life program designed specifically for employees who work in manufacturing 
B)  commercial insurance sold in large amounts for key man life insurance 
C)  purchased by a lender 
D)  sold to employees who work in high-risk industrial manufacturing jobs

Question 6

Which of the following is not a type of term life insurance?

Accepted Answer

A)  Single-year term 
B)  Single-month term 
C)  Multiyear term 
D)  Term to a specific age 
A)  Single-year term 
B)  Single-month term 
C)  Multiyear term 
D)  Term to a specific age

Question 7

A term insurance policy that includes a conversion privilege gives the insured the right to:

Accepted Answer

A)  renew the policy for another time period of the same length 
B)  exchange the term policy for a permanent plan of insurance 
C)  increase or decrease the death benefit 
D)  include the nonforfeiture provision in the policy 
A)  renew the policy for another time period of the same length 
B)  exchange the term policy for a permanent plan of insurance 
C)  increase or decrease the death benefit 
D)  include the nonforfeiture provision in the policy

Question 8

When an ordinary life insurance policy becomes payable as a death claim, the beneficiary is entitled to the:

Accepted Answer

A)  cash surrender value 
B)  face amount plus the reserve value 
C)  face amount 
D)  face amount plus the cash value 
A)  cash surrender value 
B)  face amount plus the reserve value 
C)  face amount 
D)  face amount plus the cash value

Question 9

Which of the following is true with regard to term life insurance contracts?

Accepted Answer

A)  Policies of less than 10 year length are illegal in 13 states. 
B)  One form of term life increases the amount of insurance as the balance due on a mortgage declines over time. 
C)  Renewable term life insurance guarantees the insured that upon renewal, his premiums will not increase. 
D)  Term insurance provides temporary protection. 
A)  Policies of less than 10 year length are illegal in 13 states. 
B)  One form of term life increases the amount of insurance as the balance due on a mortgage declines over time. 
C)  Renewable term life insurance guarantees the insured that upon renewal, his premiums will not increase. 
D)  Term insurance provides temporary protection.

Question 10

Which of the following is true?

Accepted Answer

A)  Term life insurance is most suitable when the need for protection is permanent. 
B)  Decreasing term insurance is useful when the insured's debt is increasing at a steady, predictable rate. 
C)  Whole life insurance is best when the insured desires temporary coverage because its cash values will refund nearly all premiums paid. 
D)  Whole life insurance can provide funds whether the insured dies or survives the policy period. 
A)  Term life insurance is most suitable when the need for protection is permanent. 
B)  Decreasing term insurance is useful when the insured's debt is increasing at a steady, predictable rate. 
C)  Whole life insurance is best when the insured desires temporary coverage because its cash values will refund nearly all premiums paid. 
D)  Whole life insurance can provide funds whether the insured dies or survives the policy period.

Question 11

Term life insurance has significantly increased in popularity. Why?

Accepted Answer

A)  Lower rates and greater tax deductions offered to the wealthy 
B)  Lower rates and tax credit incentives offered to the poor 
C)  Stable rates with increased benefits for everyone 
D)  Lower rates and availability of tax-advantaged savings plans 
A)  Lower rates and greater tax deductions offered to the wealthy 
B)  Lower rates and tax credit incentives offered to the poor 
C)  Stable rates with increased benefits for everyone 
D)  Lower rates and availability of tax-advantaged savings plans

Question 12

What are the advantages of saving with cash value whole life insurance?

Accepted Answer

The advantages of saving with cash value

Question 13

Which of the following is false with respect to universal life insurance (ULI)?

Accepted Answer

A)  Is interest sensitive 
B)  Has flexible premiums and benefits 
C)  Is cheaper than ordinary whole life 
D)  Has the tax benefits of ordinary life insurance 
A)  Is interest sensitive 
B)  Has flexible premiums and benefits 
C)  Is cheaper than ordinary whole life 
D)  Has the tax benefits of ordinary life insurance

Question 14

Premiums for industrial insurance are collected at the insured's home, often on a weekly basis.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following best describes what life insurance is designed to protect against?

Accepted Answer

A)  Dying before financial obligations have been met 
B)  Outliving your income 
C)  Probability of dying increasing as you grow older 
D)  Loss of income due to retirement 
A)  Dying before financial obligations have been met 
B)  Outliving your income 
C)  Probability of dying increasing as you grow older 
D)  Loss of income due to retirement

Question 16

After taking an introductory course in insurance, your parents ask you what type of life insurance policy they should purchase to get permanent death protection with the option to pay more premiums some years, and less in other years. They also want a minimum guaranteed rate of return on their cash value. Which type of life insurance will you recommend?

Accepted Answer

A)  Term life 
B)  Whole life 
C)  Universal life 
D)  Variable life 
A)  Term life 
B)  Whole life 
C)  Universal life 
D)  Variable life

Which of the following life insurance policies would have the lowest premium for a male age 40?

There is more Individual Life Insurance Coverage in the United States compared to Group Life Insurance Coverage.

Regarding variable life insurance, all of the following are true except:

In a limited payment policy, only a portion of the face amount is paid if death occurs in the early years.

Credit life insurance is:

Which of the following is not a type of term life insurance?

A term insurance policy that includes a conversion privilege gives the insured the right to:

When an ordinary life insurance policy becomes payable as a death claim, the beneficiary is entitled to the:

Which of the following is true with regard to term life insurance contracts?

Which of the following is true?

Term life insurance has significantly increased in popularity. Why?

What are the advantages of saving with cash value whole life insurance?

Which of the following is false with respect to universal life insurance (ULI)?

Premiums for industrial insurance are collected at the insured's home, often on a weekly basis.

Which of the following best describes what life insurance is designed to protect against?

Introduction to Enterprise Risk Management and Insurance

Risk Identification

Risk Assessment and Pooling

Risk-Handling Techniques: Loss Control, Risk Transfer, and Loss Financing

Risk-Handling Techniques: Diversification and Hedging

Fundamentals of Insurance

Insurable Perils and Insuring Organizations

Insurance Functions

Insurance Markets: Economics and Issues

Insurance Regulation

Insurance Contracts

The Personal Auto Policy

Homeowners Insurance

Professional Financial Planning

Standard Life Insurance Contract Provisions and Options

Annuities

Health Insurance and Disability Income

Employee Benefits

Social Security

Unemployment and Workers Compensation Insurance

Commercial Property Insurance

Commercial Liability Insurance

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Exam 15: Life Insurance Policies

Which of the following life insurance policies would have the lowest premium for a male age 40?

There is more Individual Life Insurance Coverage in the United States compared to Group Life Insurance Coverage.

Regarding variable life insurance, all of the following are true except:

In a limited payment policy, only a portion of the face amount is paid if death occurs in the early years.

Credit life insurance is:

Which of the following is not a type of term life insurance?

A term insurance policy that includes a conversion privilege gives the insured the right to:

When an ordinary life insurance policy becomes payable as a death claim, the beneficiary is entitled to the:

Which of the following is true with regard to term life insurance contracts?

Which of the following is true?

Term life insurance has significantly increased in popularity. Why?

What are the advantages of saving with cash value whole life insurance?

Which of the following is false with respect to universal life insurance (ULI)?

Premiums for industrial insurance are collected at the insured's home, often on a weekly basis.

Which of the following best describes what life insurance is designed to protect against?

Introduction to Enterprise Risk Management and Insurance

Risk Identification

Risk Assessment and Pooling

Risk-Handling Techniques: Loss Control, Risk Transfer, and Loss Financing

Risk-Handling Techniques: Diversification and Hedging

Fundamentals of Insurance

Insurable Perils and Insuring Organizations

Insurance Functions

Insurance Markets: Economics and Issues

Insurance Regulation

Insurance Contracts

The Personal Auto Policy

Homeowners Insurance

Professional Financial Planning

Standard Life Insurance Contract Provisions and Options

Annuities

Health Insurance and Disability Income

Employee Benefits

Social Security

Unemployment and Workers Compensation Insurance

Commercial Property Insurance

Commercial Liability Insurance

Filters