Question 1

A life insurance policy with a small face amount where the premium may be collected weekly by agents is termed _____.

Accepted Answer

A) credit life insurance 
B) mortgage life insurance 
C) industrial life insurance 
D) special purpose insurance 
E) group life insurance 
A) credit life insurance 
B) mortgage life insurance 
C) industrial life insurance 
D) special purpose insurance 
E) group life insurance

Question 2

In order to predict the number of losses that will occur in a given time accurately,insurance companies must study a ___________ numbers of cases. ​

Accepted Answer

A) medium 
B) small 
C) large 
D) negligible 
A) medium 
B) small 
C) large 
D) negligible

Question 3

_____ determines the amount of life insurance coverage required for an individual by considering his or her financial obligations and available financial resources in addition to life insurance.

Accepted Answer

A) The savings analysis method 
B) The needs analysis method 
C) The earnings analysis method 
D) The liabilities analysis method 
E) The borrowings analysis method 
A) The savings analysis method 
B) The needs analysis method 
C) The earnings analysis method 
D) The liabilities analysis method 
E) The borrowings analysis method

Question 4

Insurance is a tool that can reduce one's _____ risk.

Accepted Answer

A) social 
B) mental 
C) economic 
D) accident 
E) exposure 
A) social 
B) mental 
C) economic 
D) accident 
E) exposure

Question 5

The availability of group coverage through employee benefit programs should be considered when developing a life insurance program.

Accepted Answer

A) True 
 B)False

Question 6

___________ insurance is a type of insurance that is issued in policies with small face amounts,often $1,000 or less. ​

Accepted Answer

A) Credit life 
B) Industrial life 
C) Mortgage life 
D) Variable life 
A) Credit life 
B) Industrial life 
C) Mortgage life 
D) Variable life

Question 7

Sales commissions and marketing expenses can increase the costs of a fully loaded _____ policy.

Accepted Answer

A) term life insurance 
B) whole life insurance 
C) universal life insurance 
D) variable life insurance 
E) mortgage life insurance 
A) term life insurance 
B) whole life insurance 
C) universal life insurance 
D) variable life insurance 
E) mortgage life insurance

Question 8

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 9

_____ 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 10

While performing needs analysis,when determining the available resources to offset the economic needs,you would generally ignore:

Accepted Answer

A) Social Security benefits. 
B) the educational qualification of the children. 
C) the earning potential of the surviving spouse. 
D) savings corpus. 
E) the employer-provided group life insurance. 
A) Social Security benefits. 
B) the educational qualification of the children. 
C) the earning potential of the surviving spouse. 
D) savings corpus. 
E) the employer-provided group life insurance.

Question 11

The policy owner assumes the investment risk with a ___________ insurance policy. ​

Accepted Answer

A) whole life 
B) term life 
C) variable life 
D) viatical life 
A) whole life 
B) term life 
C) variable life 
D) viatical life

Question 12

While using the needs analysis approach,we _____.

Accepted Answer

A) add an individual's available resources to his or her family's total economic needs to calculate how much life insurance he or she requires 
B) multiply an individual's gross annual earnings by some selected number to arrive at an estimate of adequate life insurance coverage 
C) get only a loose approximation of life insurance needs of an individual 
D) divide an individual's gross annual earnings by some selected number to arrive at an estimate of adequate life insurance coverage 
E) deduct an individual's available resources from his or her family's total economic needs to calculate how much life insurance he or she requires 
A) add an individual's available resources to his or her family's total economic needs to calculate how much life insurance he or she requires 
B) multiply an individual's gross annual earnings by some selected number to arrive at an estimate of adequate life insurance coverage 
C) get only a loose approximation of life insurance needs of an individual 
D) divide an individual's gross annual earnings by some selected number to arrive at an estimate of adequate life insurance coverage 
E) deduct an individual's available resources from his or her family's total economic needs to calculate how much life insurance he or she requires

Question 13

The primary purpose of life insurance is to protect family members of the insured from financial loss in the event of his or her untimely death.

Accepted Answer

A) True 
 B)False

Question 14

Insurance companies make profit by:

Accepted Answer

A) charging consultation fees to the insured. 
B) avoiding the risk of loss of the insured. 
C) charging underwriting fees from insurance agents. 
D) paying out less than the sum of the premiums and the earnings on them. 
E) giving less than the amount mentioned in the policy to the insured. 
A) charging consultation fees to the insured. 
B) avoiding the risk of loss of the insured. 
C) charging underwriting fees from insurance agents. 
D) paying out less than the sum of the premiums and the earnings on them. 
E) giving less than the amount mentioned in the policy to the insured.

Question 15

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

Accepted Answer

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

Question 16

Which of the following is true of insurance underwriting?

Accepted Answer

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

Question 17

From the standpoint of a person buying insurance,the central purpose of insurance should be:

Accepted Answer

A) to transfer the risk of serious losses. 
B) to collect for all accidental losses. 
C) to profit from uncertain future events. 
D) to contribute to charitable purposes. 
E) to reduce payouts for the small risks taken. 
A) to transfer the risk of serious losses. 
B) to collect for all accidental losses. 
C) to profit from uncertain future events. 
D) to contribute to charitable purposes. 
E) to reduce payouts for the small risks taken.

Question 18

The most preferred technique for determining how much life insurance coverage is needed for an individual is:

Accepted Answer

A) computing the Human Life Value. 
B) using the probability of death each year,prevailing interest rates,and assumed inflation rates to find the discounted present value of a future income stream. 
C) assessing the family's total economic needs and subtracting the financial resources available to meet those needs. 
D) estimating the sum of money which,when paid in installments,will produce the same income as the person would have earned after deducting assumed amounts for taxes and personal maintenance expenses. 
E) using the multiple-of-earnings method adjusted for occupation. 
A) computing the Human Life Value. 
B) using the probability of death each year,prevailing interest rates,and assumed inflation rates to find the discounted present value of a future income stream. 
C) assessing the family's total economic needs and subtracting the financial resources available to meet those needs. 
D) estimating the sum of money which,when paid in installments,will produce the same income as the person would have earned after deducting assumed amounts for taxes and personal maintenance expenses. 
E) using the multiple-of-earnings method adjusted for occupation.

Question 19

Which of the following types of insurance policies provides temporary coverage for a set period?

Accepted Answer

A) Universal life insurance policy 
B) Whole life insurance policy 
C) Variable life insurance policy 
D) Term life insurance policy 
E) Extended life insurance policy 
A) Universal life insurance policy 
B) Whole life insurance policy 
C) Variable life insurance policy 
D) Term life insurance policy 
E) Extended life insurance policy

Question 20

If an insured has a high-risk hobby,then he or she should expect to pay less for life insurance.

Accepted Answer

A) True 
 B)False

A life insurance policy with a small face amount where the premium may be collected weekly by agents is termed _____.

In order to predict the number of losses that will occur in a given time accurately,insurance companies must study a ___________ numbers of cases.

_____ determines the amount of life insurance coverage required for an individual by considering his or her financial obligations and available financial resources in addition to life insurance.

Insurance is a tool that can reduce one's _____ risk.

The availability of group coverage through employee benefit programs should be considered when developing a life insurance program.

___________ insurance is a type of insurance that is issued in policies with small face amounts,often $1,000 or less.

Sales commissions and marketing expenses can increase the costs of a fully loaded _____ policy.

Insurance underwriting is best described as:

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

While performing needs analysis,when determining the available resources to offset the economic needs,you would generally ignore:

The policy owner assumes the investment risk with a ___________ insurance policy.

While using the needs analysis approach,we _____.

The primary purpose of life insurance is to protect family members of the insured from financial loss in the event of his or her untimely death.

Insurance companies make profit by:

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

Which of the following is true of insurance underwriting?

From the standpoint of a person buying insurance,the central purpose of insurance should be:

The most preferred technique for determining how much life insurance coverage is needed for an individual is:

Which of the following types of insurance policies provides temporary coverage for a set period?

If an insured has a high-risk hobby,then he or she should expect to pay less for life insurance.

Understanding the Financial Planning 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

A life insurance policy with a small face amount where the premium may be collected weekly by agents is termed _____.

In order to predict the number of losses that will occur in a given time accurately,insurance companies must study a ___________ numbers of cases. ​

_____ determines the amount of life insurance coverage required for an individual by considering his or her financial obligations and available financial resources in addition to life insurance.

Insurance is a tool that can reduce one's _____ risk.

The availability of group coverage through employee benefit programs should be considered when developing a life insurance program.

___________ insurance is a type of insurance that is issued in policies with small face amounts,often $1,000 or less. ​

Sales commissions and marketing expenses can increase the costs of a fully loaded _____ policy.

Insurance underwriting is best described as:

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

While performing needs analysis,when determining the available resources to offset the economic needs,you would generally ignore:

The policy owner assumes the investment risk with a ___________ insurance policy. ​

While using the needs analysis approach,we _____.

The primary purpose of life insurance is to protect family members of the insured from financial loss in the event of his or her untimely death.

Insurance companies make profit by:

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

Which of the following is true of insurance underwriting?

From the standpoint of a person buying insurance,the central purpose of insurance should be:

The most preferred technique for determining how much life insurance coverage is needed for an individual is:

Which of the following types of insurance policies provides temporary coverage for a set period?

If an insured has a high-risk hobby,then he or she should expect to pay less for life insurance.

Understanding the Financial Planning 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

In order to predict the number of losses that will occur in a given time accurately,insurance companies must study a ___________ numbers of cases.

___________ insurance is a type of insurance that is issued in policies with small face amounts,often $1,000 or less.

The policy owner assumes the investment risk with a ___________ insurance policy.