Question 1

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Accepted Answer

A) True 
 B)False

Question 2

Which type of settlement option pays the beneficiary over a specified time frame?

Accepted Answer

A) Lump sum 
B) Interest only 
C) Lifetime income 
D) Fixed period 
E) Fixed amount 
A) Lump sum 
B) Interest only 
C) Lifetime income 
D) Fixed period 
E) Fixed amount

Question 3

If life insurance is convertible,the policy can be

Accepted Answer

A) transferred to the life of another person. 
B) exchanged for cash. 
C) changed to health or disability protection 
D) changed to another type of life insurance. 
E) revised as needed. 
A) transferred to the life of another person. 
B) exchanged for cash. 
C) changed to health or disability protection 
D) changed to another type of life insurance. 
E) revised as needed.

Question 4

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-Social security survivors' benefits typically provide benefits for children through [high school | college].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 5

Insurance is a tool that can lessen ____ risk.

Accepted Answer

A) social 
B) mental 
C) economic 
D) accident 
E) exposure 
A) social 
B) mental 
C) economic 
D) accident 
E) exposure

Question 6

Policy dividends paid on participating policies are a return of unused premium based upon the claims experience of the insurance company.

Accepted Answer

A) True 
 B)False

Question 7

If a named beneficiary does not survive an insured,the proceeds of the policy revert to the insurance company.

Accepted Answer

A) True 
 B)False

Question 8

The most valuable single technique in determining how much life insurance is needed is:

Accepted Answer

A) Computing the Human Life Value. 
B) Using the probability of death each year, prevailing interest rates, and assumed inflation rates to find the discounted present value of a future income stream. 
C) Assessing the family's total economic needs and subtracting financial resources available to meet those needs. 
D) Estimating the sum of money which, when paid in installments, will produce the same income as the person would have earned, after deducting assumed amounts for taxes and personal maintenance expenses. 
E) Using a multiple of earnings adjusted for occupation. 
A) Computing the Human Life Value. 
B) Using the probability of death each year, prevailing interest rates, and assumed inflation rates to find the discounted present value of a future income stream. 
C) Assessing the family's total economic needs and subtracting financial resources available to meet those needs. 
D) Estimating the sum of money which, when paid in installments, will produce the same income as the person would have earned, after deducting assumed amounts for taxes and personal maintenance expenses. 
E) Using a multiple of earnings adjusted for occupation.

Question 9

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The beneficiary [will | will not] have to pay income taxes on the proceeds from a life insurance policy.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 10

The primary purpose of life insurance is to provide

Accepted Answer

A) financial security for dependents in the event of death. 
B) protection from creditors and lawsuits. 
C) tax-advantaged investments. 
D) high-yield investments. 
E) all of the above. 
A) financial security for dependents in the event of death. 
B) protection from creditors and lawsuits. 
C) tax-advantaged investments. 
D) high-yield investments. 
E) all of the above.

Question 11

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-You can learn about the financial strength of an insurance company by checking [the SEC's | A.M.Best's] rating system.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 12

It is advisable to purchase life insurance from a relatively small,newly formed company.

Accepted Answer

A) True 
 B)False

Question 13

Underwriting is best described as

Accepted Answer

A) the process of deciding whom the company will insure and the applicable premiums it will charge. 
B) actuarial science. 
C) production-related activities performed primarily by agents in the field. 
D) the process of developing pricing structures for insurance, often performed by an actuary. 
E) a function most often performed by adjusters. 
A) the process of deciding whom the company will insure and the applicable premiums it will charge. 
B) actuarial science. 
C) production-related activities performed primarily by agents in the field. 
D) the process of developing pricing structures for insurance, often performed by an actuary. 
E) a function most often performed by adjusters.

Question 14

Like universal life insurance,variable life insurance provides a minimum guaranteed return.

Accepted Answer

A) True 
 B)False

Question 15

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-Most term insurance [is | is not] renewable.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 16

The three major categories of life insurance are term,straight life,and limited payment.

Accepted Answer

A) True 
 B)False

Question 17

Group life insurance is often provided as a fringe benefit by employers.

Accepted Answer

A) True 
 B)False

Question 18

Whole life policies typically provide a high investment rate of return.

Accepted Answer

A) True 
 B)False

Question 19

Through insurance,society is able to

Accepted Answer

A) reduce costs. 
B) increase rewards. 
C) reduce financial risks and share losses. 
D) change financial risks and reduce losses. 
E) anticipate risks. 
A) reduce costs. 
B) increase rewards. 
C) reduce financial risks and share losses. 
D) change financial risks and reduce losses. 
E) anticipate risks.

Question 20

Rodney and Toni are a young couple with two small children.They are doing well financially but their life insurance needs are high and their budget is tight.What type of life insurance will give them the most protection for their money?

Accepted Answer

A) continuous premium 
B) universal life 
C) paid up life 
D) term life 
E) variable life 
A) continuous premium 
B) universal life 
C) paid up life 
D) term life 
E) variable life

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Which type of settlement option pays the beneficiary over a specified time frame?

If life insurance is convertible,the policy can be

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Social security survivors' benefits typically provide benefits for children through [high school | college].

Insurance is a tool that can lessen ____ risk.

Policy dividends paid on participating policies are a return of unused premium based upon the claims experience of the insurance company.

If a named beneficiary does not survive an insured,the proceeds of the policy revert to the insurance company.

The most valuable single technique in determining how much life insurance is needed is:

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The beneficiary [will | will not] have to pay income taxes on the proceeds from a life insurance policy.

The primary purpose of life insurance is to provide

It is advisable to purchase life insurance from a relatively small,newly formed company.

Underwriting is best described as

Like universal life insurance,variable life insurance provides a minimum guaranteed return.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Most term insurance [is | is not] renewable.

The three major categories of life insurance are term,straight life,and limited payment.

Group life insurance is often provided as a fringe benefit by employers.

Whole life policies typically provide a high investment rate of return.

Through insurance,society is able to

Rodney and Toni are a young couple with two small children.They are doing well financially but their life insurance needs are high and their budget is tight.What type of life insurance will give them the most protection for their money?

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

Annual term insurance premiums increase as you get older while whole life insurance premiums remain constant.

Which type of settlement option pays the beneficiary over a specified time frame?

If life insurance is convertible,the policy can be

Insurance is a tool that can lessen ____ risk.

Policy dividends paid on participating policies are a return of unused premium based upon the claims experience of the insurance company.

If a named beneficiary does not survive an insured,the proceeds of the policy revert to the insurance company.

The most valuable single technique in determining how much life insurance is needed is:

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The beneficiary [will | will not] have to pay income taxes on the proceeds from a life insurance policy.

The primary purpose of life insurance is to provide

It is advisable to purchase life insurance from a relatively small,newly formed company.

Underwriting is best described as

Like universal life insurance,variable life insurance provides a minimum guaranteed return.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Most term insurance [is | is not] renewable.

The three major categories of life insurance are term,straight life,and limited payment.

Group life insurance is often provided as a fringe benefit by employers.

Whole life policies typically provide a high investment rate of return.

Through insurance,society is able to

Rodney and Toni are a young couple with two small children.They are doing well financially but their life insurance needs are high and their budget is tight.What type of life insurance will give them the most protection for their money?

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