Question 1

Accelerated benefits are life insurance policy proceeds paid to the terminally ill policyholder before he or she dies.

Accepted Answer

A) True 
 B)False

Question 2

Using the "nonworking" spouse method,what should be the life insurance needs for a family whose youngest child is 8 years old?

Accepted Answer

A)  $50,000
B)  $70,000
C)  $80,000
D)  $100,000
E)  $180,000F) All of the above
G) C) and E)

Question 3

Universal life is a whole life policy that combines term insurance with an investment option.

Accepted Answer

A) True 
 B)False

Question 4

The DINK method of determining life insurance needs assumes that your spouse will continue to work after your death.

Accepted Answer

A) True 
 B)False

Question 5

Russell Lowe has a life insurance policy that allows him to change his premium without changing his coverage.He can also access his cash value with a policy loan or a withdrawal.What type of insurance does Russell likely have?

Accepted Answer

A)  Ordinary whole life
B)  Limited payment life
C)  Variable life
D)  Adjustable life
E)  Universal lifeF) A) and E)
G) A) and D)

Question 6

One of the ten golden rules when buying life insurance is to:

Accepted Answer

A)  buy from an unlicensed company.
B)  buy more life insurance than you need.
C)  select an agent who is incompetent.
D)  ask about lower premium rates for nonsmokers.
E)  not worry about reading and understanding your policy.F) B) and C)
G) A) and D)

Question 7

The cash values of a variable life insurance policy increase at a constant rate over time.

Accepted Answer

A) True 
 B)False

Question 8

You probably have little or no need for life insurance if you are:

Accepted Answer

A)  a single person living with your parents.
B)  divorced and have two children.
C)  married and your spouse works.
D)  gainfully employed.
E)  a two-earner household with a mortgage.F) A) and B)
G) All of the above

Question 9

Which type of life insurance policy requires you to pay premiums for a stipulated period,usually 20 or 30 years,or until you reach a specified age?

Accepted Answer

A)  Modified life policy
B)  Variable life policy
C)  Adjustable life policy
D)  Limited payment policy
E)  Endowment policyF) D) and E)
G) C) and E)

Question 10

Stock life insurance companies are owned by their policyholders.

Accepted Answer

A) True 
 B)False

Question 11

The prices of life insurance policies:

Accepted Answer

A)  vary considerably among life insurance companies.
B)  are relatively the same for all policies.
C)  are higher for females than males.
D)  have remained constant over time.
E)  are set by the government here in the United States.F) A) and E)
G) C) and D)

Question 12

Lori Simpson is thinking about purchasing some life insurance.She goes to a company where the policyholders are essentially the owners of the company.What type of life insurance company has she visited?

Accepted Answer

A)  Stock
B)  Debt
C)  Mutual
D)  Exclusionary
E)  CooperativeF) A) and B)
G) None of the above

Question 13

A beneficiary is a person designated to receive something,such as life insurance proceeds,from the insured.

Accepted Answer

A) True 
 B)False

Question 14

A special form of the limited payment plan is the single-premium policy.In this type of contract,you make only one very large premium payment.

Accepted Answer

A) True 
 B)False

Question 15

The premium that is refunded to policyholders of a participating policy is called the policy dividend.

Accepted Answer

A) True 
 B)False

Question 16

Individuals and families purchase life insurance primarily to:

Accepted Answer

A)  pay liability claims resulting from accidents.
B)  protect someone who depends on them from financial losses caused by their death.
C)  fund lavish retirement vacations.
D)  keep up with people with a similar financial situation.
E)  make early retirement possible.F) All of the above
G) C) and E)

Question 17

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 18

You can purchase life insurance from two types of life insurance companies.

Accepted Answer

A) True 
 B)False

Question 19

Most insurance companies can determine how long a particular person will live.

Accepted Answer

A) True 
 B)False

Question 20

Term life insurance premiums decrease as you get older.

Accepted Answer

A) True 
 B)False

Exam 12: Life Insurance

The DINK method of determining life insurance needs assumes that your spouse will continue to work after your death.

Correct AnswerverifiedShow Answer

Accelerated benefits are life insurance policy proceeds paid to the terminally ill policyholder before he or she dies.

Correct AnswerverifiedShow Answer

The cash values of a variable life insurance policy increase at a constant rate over time.

Correct AnswerverifiedShow Answer

The premium that is refunded to policyholders of a participating policy is called the policy dividend.

Correct AnswerverifiedShow Answer

Using the "nonworking" spouse method,what should be the life insurance needs for a family whose youngest child is 8 years old?

Correct AnswerverifiedShow Answer

A special form of the limited payment plan is the single-premium policy.In this type of contract,you make only one very large premium payment.

Correct AnswerverifiedShow Answer

Individuals and families purchase life insurance primarily to:

Correct AnswerverifiedShow Answer

You can purchase life insurance from two types of life insurance companies.

Correct AnswerverifiedShow Answer

Lori Simpson is thinking about purchasing some life insurance.She goes to a company where the policyholders are essentially the owners of the company.What type of life insurance company has she visited?

Correct AnswerverifiedShow Answer

You probably have little or no need for life insurance if you are:

Correct AnswerverifiedShow Answer

A beneficiary is a person designated to receive something,such as life insurance proceeds,from the insured.

Correct AnswerverifiedShow Answer

The prices of life insurance policies:

Correct AnswerverifiedShow Answer

One of the ten golden rules when buying life insurance is to:

Correct AnswerverifiedShow Answer

Term life insurance premiums decrease as you get older.

Correct AnswerverifiedShow Answer

Stock life insurance companies are owned by their policyholders.

Correct AnswerverifiedShow Answer

Russell Lowe has a life insurance policy that allows him to change his premium without changing his coverage.He can also access his cash value with a policy loan or a withdrawal.What type of insurance does Russell likely have?

Correct AnswerverifiedShow Answer

Universal life is a whole life policy that combines term insurance with an investment option.

Correct AnswerverifiedShow Answer

Most insurance companies can determine how long a particular person will live.

Correct AnswerverifiedShow Answer

Which type of life insurance policy requires you to pay premiums for a stipulated period,usually 20 or 30 years,or until you reach a specified age?

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified