Question 1

Which of the following insurance type is strictly intended to provide only insurance in the event of death?

Accepted Answer

A) Whole life 
B) Term 
C) Universal life 
D) Variable life 
A) Whole life 
B) Term 
C) Universal life 
D) Variable life B

Question 2

On which type of insurance policy is choosing an insurance company with a high rating the most important?

Accepted Answer

A) Disability insurance 
B) Automobile insurance 
C) Homeowner's insurance 
D) Life insurance 
A) Disability insurance 
B) Automobile insurance 
C) Homeowner's insurance 
D) Life insurance D

Question 3

If no one else relies on your income,life insurance may not be necessary.

Accepted Answer

A) True 
 B)False  True

Question 4

The income method,basing life insurance needs on multiples of current income,is the easiest and most accurate method of determining how much life insurance a person should buy.

Accepted Answer

A) True 
 B)False

Question 5

Life insurance may not be that important for a couple who both work full-time and who could each be self-sufficient without the other person's income.

Accepted Answer

A) True 
 B)False

Question 6

________ insurance is life insurance that is provided over a specified time period and does not build cash value.

Accepted Answer

A) Term 
B) Whole life 
C) Universal life 
D) Variable life 
A) Term 
B) Whole life 
C) Universal life 
D) Variable life

Question 7

The problem with the cash value build up of a whole life insurance policy is that the money can only be used to pay off the policy or buy additional insurance.

Accepted Answer

A) True 
 B)False

Question 8

What are three types of settlement options?

Accepted Answer

Lump-sum,installment

Question 9

The cheapest form of life insurance that provides coverage for a specified time period is ________.

Accepted Answer

The answer of The cheapest form of life insurance that...

Question 10

A life insurance premium is ________ related to your age.

Accepted Answer

A) somewhat 
B) occasionally 
C) directly 
D) inversely 
A) somewhat 
B) occasionally 
C) directly 
D) inversely

Question 11

A lump sum settlement option is usually the best choice,even if a beneficiary is not very good at managing sums of money.

Accepted Answer

A) True 
 B)False

Question 12

Low cost life insurance,often available without a physical exam,is generally offered by

Accepted Answer

A) Internet insurance companies. 
B) mutual insurance companies. 
C) employer-sponsored group insurance plans. 
D) independent insurance agents. 
A) Internet insurance companies. 
B) mutual insurance companies. 
C) employer-sponsored group insurance plans. 
D) independent insurance agents.

Question 13

The best time to buy a whole life insurance policy in terms of expense is

Accepted Answer

A) as a child. 
B) when you are in college. 
C) when you have dependents. 
D) in your retirement. 
A) as a child. 
B) when you are in college. 
C) when you have dependents. 
D) in your retirement.

Question 14

Describe the two methods used to determine the life insurance amount.

Accepted Answer

The income method determines how much li

Question 15

Universal life insurance is the same from one insurance company to another and is,therefore,the most common and popular form of life insurance.

Accepted Answer

A) True 
 B)False

Question 16

If you wanted to provide more coverage to your family early in life when they need it the most and decrease this amount of coverage in later years,yet continue to pay the same premiums,you should buy a(n)________ policy.

Accepted Answer

A) whole life 
B) decreasing term 
C) universal life 
D) variable life 
A) whole life 
B) decreasing term 
C) universal life 
D) variable life

Question 17

Sam figures it will take $250,000 invested at 6% to provide suitable income to his family for 12 years.He would also like to have $40,000 set aside to educate his two children.Sam's current savings is $20,000.How much life insurance does he need using the budget method?

Accepted Answer

A) $190,000 
B) $250,000 
C) $270,000 
D) $310,000 
A) $190,000 
B) $250,000 
C) $270,000 
D) $310,000

Question 18

If a policyholder with a universal life insurance policy skips a payment,then the policy

Accepted Answer

A) is terminated. 
B) refunds the amount paid and terminates the policy. 
C) uses an amount from savings to pay the premium. 
D) has the premium increased. 
A) is terminated. 
B) refunds the amount paid and terminates the policy. 
C) uses an amount from savings to pay the premium. 
D) has the premium increased.

Question 19

Life insurance may be obtained through all of the following except

Accepted Answer

A) financial institutions. 
B) private insurance companies. 
C) the federal government. 
D) your employer. 
A) financial institutions. 
B) private insurance companies. 
C) the federal government. 
D) your employer.

Question 20

Life insurance is critical to protect a family's financial situation in the event that a breadwinner dies.

Accepted Answer

A) True 
 B)False

Exam 13: Life Insurance

Which of the following insurance type is strictly intended to provide only insurance in the event of death?

On which type of insurance policy is choosing an insurance company with a high rating the most important?

If no one else relies on your income,life insurance may not be necessary.

The income method,basing life insurance needs on multiples of current income,is the easiest and most accurate method of determining how much life insurance a person should buy.

Life insurance may not be that important for a couple who both work full-time and who could each be self-sufficient without the other person's income.

________ insurance is life insurance that is provided over a specified time period and does not build cash value.

The problem with the cash value build up of a whole life insurance policy is that the money can only be used to pay off the policy or buy additional insurance.

What are three types of settlement options?

The cheapest form of life insurance that provides coverage for a specified time period is ________.

A life insurance premium is ________ related to your age.

A lump sum settlement option is usually the best choice,even if a beneficiary is not very good at managing sums of money.

Low cost life insurance,often available without a physical exam,is generally offered by

The best time to buy a whole life insurance policy in terms of expense is

Describe the two methods used to determine the life insurance amount.

Universal life insurance is the same from one insurance company to another and is,therefore,the most common and popular form of life insurance.

If you wanted to provide more coverage to your family early in life when they need it the most and decrease this amount of coverage in later years,yet continue to pay the same premiums,you should buy a(n)________ policy.

Sam figures it will take $250,000 invested at 6% to provide suitable income to his family for 12 years.He would also like to have $40,000 set aside to educate his two children.Sam's current savings is $20,000.How much life insurance does he need using the budget method?

If a policyholder with a universal life insurance policy skips a payment,then the policy

Life insurance may be obtained through all of the following except

Life insurance is critical to protect a family's financial situation in the event that a breadwinner dies.

Overview of a Financial Plan

Planning With Personal Financial Statements

Applying Time Value Concepts

Using Tax Concepts for Planning

Banking and Interest Rates

Managing Your Money

Assessing and Securing Your Credit

Managing Your Credit

Personal Loans

Purchasing and Financing a Home

Auto and Homeowners Insurance

Health and Disability Insurance

Investing Fundamentals

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Asset Allocation

Retirement Planning

Estate Planning

Integrating the Components of a Financial Plan

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