Question 1

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 2

If you have convertible term insurance,you can exchange it for a whole life policy without a medical examination and at a higher premium.

Accepted Answer

A) True 
 B)False

Question 3

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 4

The total debts of you and your spouse include the following: mortgage,$180,000;auto loan,$10,000;credit card balance,$2,000;and other debts of $6,000.Further,you estimate that your funeral will cost $4,000.Your spouse expects to continue to work after your death.What is your life insurance need using the DINK method?

Accepted Answer

A) $103,000 
B) $106,000 
C) $226,000 
D) $202,000 
E) $99,000 
A) $103,000 
B) $106,000 
C) $226,000 
D) $202,000 
E) $99,000

Question 5

An interest-adjusted index is a method of evaluating the cost of life insurance by taking into account the time value of money.

Accepted Answer

A) True 
 B)False

Question 6

The most common type of permanent life insurance is the whole life policy.

Accepted Answer

A) True 
 B)False

Question 7

What percent of all applicants who apply for life insurance are found to be insurable?

Accepted Answer

A) 58 
B) 68 
C) 78 
D) 88 
E) 98 
A) 58 
B) 68 
C) 78 
D) 88 
E) 98

Question 8

The coverage of term insurance ends at the conclusion of the term,but you can continue it if you have a renewability option.

Accepted Answer

A) True 
 B)False

Question 9

The DINK method of determining life insurance need is best suited for:

Accepted Answer

A) singles. 
B) single parent households. 
C) non-working spouses. 
D) working spouses with no dependents. 
E) senior citizens. 
A) singles. 
B) single parent households. 
C) non-working spouses. 
D) working spouses with no dependents. 
E) senior citizens.

Question 10

Shelley Jackson has a life insurance policy where she makes payments of $185 per year for the rest of her life.This policy has a cash value that increases while she continues to make payments.If she gives up her insurance,the cash value is the amount she would receive from this policy.What type of life insurance does Shelley 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 11

Term insurance continues for the entire term even if you stop paying the premiums.

Accepted Answer

A) True 
 B)False

Question 12

Taylor Jones has a life insurance policy that returns every cent she pays in premiums if she outlives the term of the policy.She knows this policy costs 30 to 50 percent more than a traditional policy but thinks it is worth it.What type of term life insurance does Taylor have?

Accepted Answer

A) straight 
B) renewable 
C) convertible 
D) decreasing 
E) return-of-premium 
A) straight 
B) renewable 
C) convertible 
D) decreasing 
E) return-of-premium

Question 13

The premium for a whole life policy remains constant for as long as an insured lives.

Accepted Answer

A) True 
 B)False

Question 14

If your insurance agent does not give you an interest-adjusted index,your best bet is to:

Accepted Answer

A) buy the policy anyway. 
B) look for another agent. 
C) tell the agent that you are still thinking. 
D) tell the agent you will buy it later. 
E) complain to the Better Business Bureau. 
A) buy the policy anyway. 
B) look for another agent. 
C) tell the agent that you are still thinking. 
D) tell the agent you will buy it later. 
E) complain to the Better Business Bureau.

Question 15

In a participating policy,a part of the premium is refunded to the policyholder annually.

Accepted Answer

A) True 
 B)False

Question 16

Typical examples of uses of life insurance proceeds include:

Accepted Answer

A) paying off a home mortgage. 
B) funding an endowment. 
C) making charitable bequests. 
D) paying estate taxes. 
E) all of the items listed. 
A) paying off a home mortgage. 
B) funding an endowment. 
C) making charitable bequests. 
D) paying estate taxes. 
E) all of the items listed.

Question 17

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

Accepted Answer

A) True 
 B)False

Question 18

Life insurance is one of the most important purchases you may ever make.

Accepted Answer

A) True 
 B)False

Question 19

The policy loan provision permits you to borrow any amount up to the cash value of the policy.

Accepted Answer

A) True 
 B)False

Question 20

The DINK (Duel Income No Kids)method of determining life insurance needs assumes that the spouse will continue to work after husband's/wife's death.

Accepted Answer

A) True 
 B)False

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

If you have convertible term insurance,you can exchange it for a whole life policy without a medical examination and at a higher premium.

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?

An interest-adjusted index is a method of evaluating the cost of life insurance by taking into account the time value of money.

The most common type of permanent life insurance is the whole life policy.

What percent of all applicants who apply for life insurance are found to be insurable?

The coverage of term insurance ends at the conclusion of the term,but you can continue it if you have a renewability option.

The DINK method of determining life insurance need is best suited for:

Term insurance continues for the entire term even if you stop paying the premiums.

Taylor Jones has a life insurance policy that returns every cent she pays in premiums if she outlives the term of the policy.She knows this policy costs 30 to 50 percent more than a traditional policy but thinks it is worth it.What type of term life insurance does Taylor have?

The premium for a whole life policy remains constant for as long as an insured lives.

If your insurance agent does not give you an interest-adjusted index,your best bet is to:

In a participating policy,a part of the premium is refunded to the policyholder annually.

Typical examples of uses of life insurance proceeds include:

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

Life insurance is one of the most important purchases you may ever make.

The policy loan provision permits you to borrow any amount up to the cash value of the policy.

The DINK (Duel Income No Kids)method of determining life insurance needs assumes that the spouse will continue to work after husband's/wife's death.

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

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

If you have convertible term insurance,you can exchange it for a whole life policy without a medical examination and at a higher premium.

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?

An interest-adjusted index is a method of evaluating the cost of life insurance by taking into account the time value of money.

The most common type of permanent life insurance is the whole life policy.

What percent of all applicants who apply for life insurance are found to be insurable?

The coverage of term insurance ends at the conclusion of the term,but you can continue it if you have a renewability option.

The DINK method of determining life insurance need is best suited for:

Term insurance continues for the entire term even if you stop paying the premiums.

Taylor Jones has a life insurance policy that returns every cent she pays in premiums if she outlives the term of the policy.She knows this policy costs 30 to 50 percent more than a traditional policy but thinks it is worth it.What type of term life insurance does Taylor have?

The premium for a whole life policy remains constant for as long as an insured lives.

If your insurance agent does not give you an interest-adjusted index,your best bet is to:

In a participating policy,a part of the premium is refunded to the policyholder annually.

Typical examples of uses of life insurance proceeds include:

The cost-of-living protection rider is designed to help prevent inflation from eroding the purchasing power of the protection your policy provides.

Life insurance is one of the most important purchases you may ever make.

The policy loan provision permits you to borrow any amount up to the cash value of the policy.

The DINK (Duel Income No Kids)method of determining life insurance needs assumes that the spouse will continue to work after husband's/wife's death.

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