Question 1

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

Accepted Answer

A) True 
 B)False

Question 2

Accelerated benefits are life insurance policy proceeds paid to the policyholder,who is terminally ill,before he or she dies.

Accepted Answer

A) True 
 B)False

Question 3

Group life and credit life insurance are generally permanent forms of insurance.

Accepted Answer

A) True 
 B)False

Question 4

Most life insurance companies are mutuals.

Accepted Answer

A) True 
 B)False

Question 5

Catherine Carey has made the choice to stay home and raise her three kids while her husband works.She wants to determine her insurance needs.What method was specifically designed for someone in her situation?

Accepted Answer

A) Easy method 
B) DINK method 
C) Nonworking spouse method 
D) Family need method 
E) Soccer mom method 
A) Easy method 
B) DINK method 
C) Nonworking spouse method 
D) Family need method 
E) Soccer mom method

Question 6

Stock life insurance companies are owned by their policyholders.

Accepted Answer

A) True 
 B)False

Question 7

Under the Multiple of Income method of estimating life insurance needs,what important factor is excluded from the calculation?

Accepted Answer

A) annual income 
B) your current employer 
C) future earnings 
D) past earnings 
E) current assets 
A) annual income 
B) your current employer 
C) future earnings 
D) past earnings 
E) current assets

Question 8

Your annual income is $35,000.What is your life insurance need based on the easy method?

Accepted Answer

A) $35,000 
B) $110,500 
C) $171,500 
D) $191,500 
E) over $200,000 
A) $35,000 
B) $110,500 
C) $171,500 
D) $191,500 
E) over $200,000

Question 9

You probably have little or no need for life insurance if you are:

Accepted Answer

A) a single person living with your parents. 
B) divorced and have two children. 
C) married and your spouse works. 
D) gainfully employed. 
E) a two-earner household with a mortgage. 
A) a single person living with your parents. 
B) divorced and have two children. 
C) married and your spouse works. 
D) gainfully employed. 
E) a two-earner household with a mortgage.

Question 10

The cash values of a ____________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

Accepted Answer

A) modified 
B) variable 
C) adjustable 
D) ordinary 
E) temporary 
A) modified 
B) variable 
C) adjustable 
D) ordinary 
E) temporary

Question 11

What are the two basic types of life insurance? Give examples of each.

Accepted Answer

The two basic types of life insurance ar

Question 12

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 by suicide 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 if 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 by suicide 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 if suicide is suspected.

Question 13

Which of the following statements is true about group life insurance?

Accepted Answer

A) Group life has been losing its popularity recently. 
B) The cost of insurance per $1,000 is the same for each employee, regardless of age. 
C) Group insurance is not a good bargain for older employees. 
D) Principles that apply to other forms of insurance do not apply to group life insurance. 
E) Group life is never considered the same thing as term life insurance. 
A) Group life has been losing its popularity recently. 
B) The cost of insurance per $1,000 is the same for each employee, regardless of age. 
C) Group insurance is not a good bargain for older employees. 
D) Principles that apply to other forms of insurance do not apply to group life insurance. 
E) Group life is never considered the same thing as term life insurance.

Question 14

Jim Brown has a life insurance policy that allows him to change his policy to fit his changing needs.He can change either the premium he pays or the period of coverage.What type of insurance does Jim 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 15

Which statement is correct regarding mutual life insurance companies?

Accepted Answer

A) Mutual insurance companies have stockholders. 
B) Nearly all mutual companies issue only nonparticipating policies. 
C) Premiums are lower than those offered by stock companies. 
D) Mutual companies do not pay policy dividends. 
E) A mutual company refunds part of the premium to its policyholders. 
A) Mutual insurance companies have stockholders. 
B) Nearly all mutual companies issue only nonparticipating policies. 
C) Premiums are lower than those offered by stock companies. 
D) Mutual companies do not pay policy dividends. 
E) A mutual company refunds part of the premium to its policyholders.

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

A method of evaluating the cost of life insurance by taking into account the time value of money combines all of the following except:

Accepted Answer

A) premium payments. 
B) dividends. 
C) supply and demand. 
D) cash-value buildup. 
E) present value analysis. 
A) premium payments. 
B) dividends. 
C) supply and demand. 
D) cash-value buildup. 
E) present value analysis.

Question 18

Francesca Brown has a life insurance policy that provides her with protection for the next five years.However,she can get five more years of protection at the end of this term without having to have a medical examination because she will be less than 70 years old at that time.Her premiums will rise during each five-year period.What type of term life insurance does Francesca 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 19

According to a survey by Salary.com,the equivalent wage of a stay-at-home mom is approximately how much?

Accepted Answer

A) $54,000 
B) $89,000 
C) $100,000 
D) $119,000 
E) $120,000 
A) $54,000 
B) $89,000 
C) $100,000 
D) $119,000 
E) $120,000

Question 20

Which method of determining life insurance needs is designed specifically for a working couple with no dependents?

Accepted Answer

A) The multiple of income method 
B) Easy method 
C) "Nonworking" spouse method 
D) Family need method 
E) DINK method 
A) The multiple of income method 
B) Easy method 
C) "Nonworking" spouse method 
D) Family need method 
E) DINK method

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

Accelerated benefits are life insurance policy proceeds paid to the policyholder,who is terminally ill,before he or she dies.

Group life and credit life insurance are generally permanent forms of insurance.

Most life insurance companies are mutuals.

Catherine Carey has made the choice to stay home and raise her three kids while her husband works.She wants to determine her insurance needs.What method was specifically designed for someone in her situation?

Stock life insurance companies are owned by their policyholders.

Under the Multiple of Income method of estimating life insurance needs,what important factor is excluded from the calculation?

Your annual income is $35,000.What is your life insurance need based on the easy method?

You probably have little or no need for life insurance if you are:

The cash values of a ____________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

What are the two basic types of life insurance? Give examples of each.

A suicide clause means that the insurance company:

Which of the following statements is true about group life insurance?

Jim Brown has a life insurance policy that allows him to change his policy to fit his changing needs.He can change either the premium he pays or the period of coverage.What type of insurance does Jim likely have?

Which statement is correct regarding mutual life insurance companies?

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

A method of evaluating the cost of life insurance by taking into account the time value of money combines all of the following except:

According to a survey by Salary.com,the equivalent wage of a stay-at-home mom is approximately how much?

Which method of determining life insurance needs is designed specifically for a working couple with no dependents?

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 Stock

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

Permanent insurance can be limited payment,variable,adjustable,or universal life insurance.

Accelerated benefits are life insurance policy proceeds paid to the policyholder,who is terminally ill,before he or she dies.

Group life and credit life insurance are generally permanent forms of insurance.

Most life insurance companies are mutuals.

Catherine Carey has made the choice to stay home and raise her three kids while her husband works.She wants to determine her insurance needs.What method was specifically designed for someone in her situation?

Stock life insurance companies are owned by their policyholders.

Under the Multiple of Income method of estimating life insurance needs,what important factor is excluded from the calculation?

Your annual income is $35,000.What is your life insurance need based on the easy method?

You probably have little or no need for life insurance if you are:

The cash values of a ____________ life insurance policy fluctuate according to the yields earned by a separate fund,which can be a stock fund,a money market fund,or a bond fund.

What are the two basic types of life insurance? Give examples of each.

A suicide clause means that the insurance company:

Which of the following statements is true about group life insurance?

Jim Brown has a life insurance policy that allows him to change his policy to fit his changing needs.He can change either the premium he pays or the period of coverage.What type of insurance does Jim likely have?

Which statement is correct regarding mutual life insurance companies?

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

A method of evaluating the cost of life insurance by taking into account the time value of money combines all of the following except:

According to a survey by Salary.com,the equivalent wage of a stay-at-home mom is approximately how much?

Which method of determining life insurance needs is designed specifically for a working couple with no dependents?

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 Stock

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters