Exam 13: Life Insurance

You are putting $100 a month into a passbook savings account to pay for your child's college education.You worry that if you die before you have enough saved,your child will not be able to get a college education.Which of the following types of life insurance would best fit your needs at the lowest cost?

The premiums charged on life insurance will be higher if the individual is more likely to ________ in the near future.

Use the following two columns of items to answer the matching questions below: -universal life insurance

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

An employer provides all employees with term life insurance equal to their annual income. Using the income method with a factor of 5,how much additional life insurance will an employee earning $75,000 per year need?

Life insurance proceeds are generally not taxable to the

Life insurance would be necessary in all of the following situations,except

Universal life insurance does not vary from one insurance company to another and is,therefore,the most common and popular form of life insurance.

Since a key purpose of life insurance is to provide for dependents in the event of a main earner's death,it is logical that the amount of insurance purchased should be

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.

If the premium on a term insurance policy is not paid by the due date,which of the following is true?

Disadvantages of term insurance are that it increases in cost when you renew it and that it has no value when it matures or you discontinue your policy.

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

________ life insurance can only by used to pay off a home in the event of the policyholder's death.

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?

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

Life insurance is an indication of good financial planning,since it provides a payment to the policyholder upon his or her death.

The best substitute for mortgage insurance would be ________ insurance.

The most accurate method of determining life insurance needs is

The more savings a household has accumulated,the less life insurance they will need.