Question 1

The "family need" method of determining life insurance need provides a thorough estimation of life insurance needs.

Accepted Answer

A) True 
 B)False

Question 2

Life insurance proceeds may be used to provide an education or income for children.

Accepted Answer

A) True 
 B)False

Question 3

Renee Warning has a life insurance policy where the payments to beneficiaries get smaller as time passes. What type of term life insurance does Renee likely have?

Accepted Answer

A)  Straight 
B)  Renewable 
C)  Convertible 
D)  Decreasing 
E)  Accelerated 
A)  Straight 
B)  Renewable 
C)  Convertible 
D)  Decreasing 
E)  Accelerated

Question 4

Russell Lowe has a life insurance policy that allows him to pay his premiums virtually at any time and virtually in any amount, subject to certain minimums. What type of insurance does Russell likely have?

Accepted Answer

A)  Ordinary whole life 
B)  Limited payment life 
C)  Variable life 
D)  Adjustable life 
E)  Universal life 
A)  Ordinary whole life 
B)  Limited payment life 
C)  Variable life 
D)  Adjustable life 
E)  Universal life

Question 5

Jerry Lewis is thinking about purchasing some life insurance. He goes to a company that is owned by shareholders. What type of life insurance company has he visited?

Accepted Answer

A)  Stock 
B)  Debt 
C)  Mutual 
D)  Exclusionary 
E)  Cooperative 
A)  Stock 
B)  Debt 
C)  Mutual 
D)  Exclusionary 
E)  Cooperative

Question 6

The DINK method assumes that:

Accepted Answer

A)  you have only two children. 
B)  your spouse does not work. 
C)  your insurance needs are complex. 
D)  your spouse will continue to work after your death. 
E)  your spouse is in an occupation with an uncertain future. 
A)  you have only two children. 
B)  your spouse does not work. 
C)  your insurance needs are complex. 
D)  your spouse will continue to work after your death. 
E)  your spouse is in an occupation with an uncertain future.

Question 7

Jane Curtain has a participating life insurance policy that returns part of her premiums at the end of the year. What is the money that is returned to Jane called?

Accepted Answer

A)  Cash Value 
B)  Policy Dividend 
C)  Beneficiary 
D)  Rider 
E)  Double Indemnity 
A)  Cash Value 
B)  Policy Dividend 
C)  Beneficiary 
D)  Rider 
E)  Double Indemnity

Question 8

The lump-sum payment settlement option is the least used option.

Accepted Answer

A) True 
 B)False

Question 9

Single persons living alone have little or no need for life insurance.

Accepted Answer

A) True 
 B)False

Question 10

An annuity is a financial contract written by an insurance company to provide you with a regular income.

Accepted Answer

A) True 
 B)False

Question 11

What do the terms "term", "decreasing" or "declining term", and "whole life" mean with respect to life insurance?

Accepted Answer

Term or level term provides a fixed amou

Question 12

The amount of your life insurance premium for each $1,000 of coverage depends primarily on the age at which you purchase the insurance.

Accepted Answer

A) True 
 B)False

Question 13

A special form of the limited payment plan is the single-premium policy. In this type of contract, you make only one very large premium payment.

Accepted Answer

A) True 
 B)False

Question 14

A financial contract written by an insurance company to provide you with a regular monthly income for as long as you live is called:

Accepted Answer

A)  whole life insurance. 
B)  term life insurance. 
C)  modified life insurance. 
D)  single-premium insurance. 
E)  an annuity. 
A)  whole life insurance. 
B)  term life insurance. 
C)  modified life insurance. 
D)  single-premium insurance. 
E)  an annuity.

Question 15

A suicide clause means that the insurance company:

Accepted Answer

A)  can cancel the policy if suicide is proven. 
B)  will pay the death benefit equal to the amount of the premium paid, if the insured dies during the first two years that the policy is in force. 
C)  will pay only half the death benefits if the insured commits suicide. 
D)  automatically pays the premium out of the policy's cash value. 
E)  will not pay any death benefits is suicide is suspected. 
A)  can cancel the policy if suicide is proven. 
B)  will pay the death benefit equal to the amount of the premium paid, if the insured dies during the first two years that the policy is in force. 
C)  will pay only half the death benefits if the insured commits suicide. 
D)  automatically pays the premium out of the policy's cash value. 
E)  will not pay any death benefits is suicide is suspected.

Question 16

Which type of life insurance plan requires you to pay premiums for a stipulated period, usually 20 or 30 years, or until you reach a specified age?

Accepted Answer

A)  Modified life policy 
B)  Variable life policy 
C)  Adjustable life policy 
D)  Limited payment policy 
E)  Endowment policy 
A)  Modified life policy 
B)  Variable life policy 
C)  Adjustable life policy 
D)  Limited payment policy 
E)  Endowment policy

Question 17

Individuals and families purchase life insurance primarily to:

Accepted Answer

A)  pay liability claims resulting from accidents. 
B)  fill financial needs created by the loss of the breadwinner. 
C)  fund lavish retirement vacations. 
D)  keep up with people with a similar financial situation. 
E)  make early retirement possible. 
A)  pay liability claims resulting from accidents. 
B)  fill financial needs created by the loss of the breadwinner. 
C)  fund lavish retirement vacations. 
D)  keep up with people with a similar financial situation. 
E)  make early retirement possible.

Question 18

The first step in buying insurance is to determine whether you really need life insurance.

Accepted Answer

A) True 
 B)False

Question 19

The most common type of permanent life insurance is called:

Accepted Answer

A)  whole life. 
B)  term life. 
C)  universal life. 
D)  modified life. 
E)  variable life. 
A)  whole life. 
B)  term life. 
C)  universal life. 
D)  modified life. 
E)  variable life.

Question 20

Life insurance is available from a wide range of private and public sources.

Accepted Answer

A) True 
 B)False

The "family need" method of determining life insurance need provides a thorough estimation of life insurance needs.

Life insurance proceeds may be used to provide an education or income for children.

Renee Warning has a life insurance policy where the payments to beneficiaries get smaller as time passes. What type of term life insurance does Renee likely have?

Russell Lowe has a life insurance policy that allows him to pay his premiums virtually at any time and virtually in any amount, subject to certain minimums. What type of insurance does Russell likely have?

Jerry Lewis is thinking about purchasing some life insurance. He goes to a company that is owned by shareholders. What type of life insurance company has he visited?

The DINK method assumes that:

Jane Curtain has a participating life insurance policy that returns part of her premiums at the end of the year. What is the money that is returned to Jane called?

The lump-sum payment settlement option is the least used option.

Single persons living alone have little or no need for life insurance.

An annuity is a financial contract written by an insurance company to provide you with a regular income.

What do the terms "term", "decreasing" or "declining term", and "whole life" mean with respect to life insurance?

The amount of your life insurance premium for each $1,000 of coverage depends primarily on the age at which you purchase the insurance.

A special form of the limited payment plan is the single-premium policy. In this type of contract, you make only one very large premium payment.

A financial contract written by an insurance company to provide you with a regular monthly income for as long as you live is called:

A suicide clause means that the insurance company:

Which type of life insurance plan requires you to pay premiums for a stipulated period, usually 20 or 30 years, or until you reach a specified age?

Individuals and families purchase life insurance primarily to:

The first step in buying insurance is to determine whether you really need life insurance.

The most common type of permanent life insurance is called:

Life insurance is available from a wide range of private and public sources.

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

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Exam 12: Life Insurance

The "family need" method of determining life insurance need provides a thorough estimation of life insurance needs.

Life insurance proceeds may be used to provide an education or income for children.

Renee Warning has a life insurance policy where the payments to beneficiaries get smaller as time passes. What type of term life insurance does Renee likely have?

Russell Lowe has a life insurance policy that allows him to pay his premiums virtually at any time and virtually in any amount, subject to certain minimums. What type of insurance does Russell likely have?

Jerry Lewis is thinking about purchasing some life insurance. He goes to a company that is owned by shareholders. What type of life insurance company has he visited?

The DINK method assumes that:

Jane Curtain has a participating life insurance policy that returns part of her premiums at the end of the year. What is the money that is returned to Jane called?

The lump-sum payment settlement option is the least used option.

Single persons living alone have little or no need for life insurance.

An annuity is a financial contract written by an insurance company to provide you with a regular income.

What do the terms "term", "decreasing" or "declining term", and "whole life" mean with respect to life insurance?

The amount of your life insurance premium for each $1,000 of coverage depends primarily on the age at which you purchase the insurance.

A special form of the limited payment plan is the single-premium policy. In this type of contract, you make only one very large premium payment.

A financial contract written by an insurance company to provide you with a regular monthly income for as long as you live is called:

A suicide clause means that the insurance company:

Which type of life insurance plan requires you to pay premiums for a stipulated period, usually 20 or 30 years, or until you reach a specified age?

Individuals and families purchase life insurance primarily to:

The first step in buying insurance is to determine whether you really need life insurance.

The most common type of permanent life insurance is called:

Life insurance is available from a wide range of private and public sources.

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters