Question 1

Avoiding alcoholic beverage while driving is an example of risk reduction.

Accepted Answer

A) True 
 B)False

Question 2

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The [policy owner | insurance company] makes the investment decisions with variable life insurance.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 3

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Changing the beneficiary on a life insurance policy is generally [easy | difficult] to do.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 4

What is it called when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary?

Accepted Answer

A)  Participating policy 
B)  Living benefit rider 
C)  Viatical settlement 
D)  Guaranteed purchase option 
E)  None of the above 
A)  Participating policy 
B)  Living benefit rider 
C)  Viatical settlement 
D)  Guaranteed purchase option 
E)  None of the above

Question 5

A grace period permits the policy holder to retain insurance even though the premium has not been paid for

Accepted Answer

A)  a year. 
B)  6 months. 
C)  3 months. 
D)  2 months. 
E)  30 days 
A)  a year. 
B)  6 months. 
C)  3 months. 
D)  2 months. 
E)  30 days

Question 6

A guaranteed purchase option is when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary.

Accepted Answer

A) True 
 B)False

Question 7

An insured usually chooses variable life insurance in order to

Accepted Answer

A)  provide more flexible coverage. 
B)  emphasize the savings portion while still having death protection. 
C)  lessen the savings feature of life insurance. 
D)  substitute for fixed-dollar insurance protection. 
E)  reduce insurance premiums. 
A)  provide more flexible coverage. 
B)  emphasize the savings portion while still having death protection. 
C)  lessen the savings feature of life insurance. 
D)  substitute for fixed-dollar insurance protection. 
E)  reduce insurance premiums.

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-People share losses through [loss control | insurance].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 9

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The policy owner assumes the investment risk with [whole life | variable life] insurance.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 10

Deciding to sell a motorcycle would be an example of risk sharing.

Accepted Answer

A) True 
 B)False

Question 11

Mary Lou died from a heart attack.Her $20,000 policy had a double indemnity clause.Her beneficiary will receive $40,000.

Accepted Answer

A) True 
 B)False

Question 12

Generally,the primary purpose of life insurance is to provide a tax-advantaged investment plan.

Accepted Answer

A) True 
 B)False

Question 13

You want to pay premiums for 20 years and have your insurance premium obligations finished at that time,but you feel you will need life insurance for the rest of your life.You should choose ____ insurance.

Accepted Answer

A)  continuous premium 
B)  limited pay 
C)  single premium 
D)  multiple premium 
E)  universal 
A)  continuous premium 
B)  limited pay 
C)  single premium 
D)  multiple premium 
E)  universal

Question 14

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Most term insurance [is | is not] renewable.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 15

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The most accurate way to determine how much life insurance you need is to use the [multiple earnings | needs] approach.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 16

When a primary beneficiary dies before the insured,proceeds are payable to

Accepted Answer

A)  the state 
B)  the probate court 
C)  the insured's estate 
D)  the contingent beneficiary or beneficiaries 
E)  the insurance company keeps the proceeds 
A)  the state 
B)  the probate court 
C)  the insured's estate 
D)  the contingent beneficiary or beneficiaries 
E)  the insurance company keeps the proceeds

Question 17

Life insurance death benefits are not subject to income taxes.

Accepted Answer

A) True 
 B)False

Question 18

If the objective of your life insurance program is to get the greatest death protection now for your insurance dollars,you should choose ____ insurance.

Accepted Answer

A)  term 
B)  universal 
C)  limited pay 
D)  industrial 
E)  whole life 
A)  term 
B)  universal 
C)  limited pay 
D)  industrial 
E)  whole life

Question 19

With traditional whole life policies sold by an agent,sales commissions and marketing expenses account for between 50% and 100% of the first year's premium.

Accepted Answer

A) True 
 B)False

Question 20

The best way to handle risk is to

Accepted Answer

A)  avoid risk 
B)  assume risk. 
C)  try to prevent losses. 
D)  transfer risk to an insurance company. 
E)  use some combination of these. 
A)  avoid risk 
B)  assume risk. 
C)  try to prevent losses. 
D)  transfer risk to an insurance company. 
E)  use some combination of these.

Avoiding alcoholic beverage while driving is an example of risk reduction.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The [policy owner | insurance company] makes the investment decisions with variable life insurance.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Changing the beneficiary on a life insurance policy is generally [easy | difficult] to do.

What is it called when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary?

A grace period permits the policy holder to retain insurance even though the premium has not been paid for

A guaranteed purchase option is when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary.

An insured usually chooses variable life insurance in order to

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -People share losses through [loss control | insurance].

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The policy owner assumes the investment risk with [whole life | variable life] insurance.

Deciding to sell a motorcycle would be an example of risk sharing.

Mary Lou died from a heart attack.Her $20,000 policy had a double indemnity clause.Her beneficiary will receive $40,000.

Generally,the primary purpose of life insurance is to provide a tax-advantaged investment plan.

You want to pay premiums for 20 years and have your insurance premium obligations finished at that time,but you feel you will need life insurance for the rest of your life.You should choose ____ insurance.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Most term insurance [is | is not] renewable.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The most accurate way to determine how much life insurance you need is to use the [multiple earnings | needs] approach.

When a primary beneficiary dies before the insured,proceeds are payable to

Life insurance death benefits are not subject to income taxes.

If the objective of your life insurance program is to get the greatest death protection now for your insurance dollars,you should choose ____ insurance.

With traditional whole life policies sold by an agent,sales commissions and marketing expenses account for between 50% and 100% of the first year's premium.

The best way to handle risk is to

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

Planning for Retirement

Preserving Your Estate

Filters

Exam 8: Insuring Your Life

Avoiding alcoholic beverage while driving is an example of risk reduction.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The [policy owner | insurance company] makes the investment decisions with variable life insurance.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Changing the beneficiary on a life insurance policy is generally [easy | difficult] to do.

What is it called when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary?

A grace period permits the policy holder to retain insurance even though the premium has not been paid for

A guaranteed purchase option is when an insured sells an interest in the life insurance policy to an investor,who then becomes the policy's beneficiary.

An insured usually chooses variable life insurance in order to

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -People share losses through [loss control | insurance].

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The policy owner assumes the investment risk with [whole life | variable life] insurance.

Deciding to sell a motorcycle would be an example of risk sharing.

Mary Lou died from a heart attack.Her $20,000 policy had a double indemnity clause.Her beneficiary will receive $40,000.

Generally,the primary purpose of life insurance is to provide a tax-advantaged investment plan.

You want to pay premiums for 20 years and have your insurance premium obligations finished at that time,but you feel you will need life insurance for the rest of your life.You should choose ____ insurance.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Most term insurance [is | is not] renewable.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The most accurate way to determine how much life insurance you need is to use the [multiple earnings | needs] approach.

When a primary beneficiary dies before the insured,proceeds are payable to

Life insurance death benefits are not subject to income taxes.

If the objective of your life insurance program is to get the greatest death protection now for your insurance dollars,you should choose ____ insurance.

With traditional whole life policies sold by an agent,sales commissions and marketing expenses account for between 50% and 100% of the first year's premium.

The best way to handle risk is to

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

Planning for Retirement

Preserving Your Estate

Filters