Podcast
Questions and Answers
What is true about a variable insurance policy?
What is true about a variable insurance policy?
- Guarantees a minimum rate of return
- Does not guarantee an assignment provision
- Does not guarantee a return on its investment accounts (correct)
- Does not allow the policyowner to assume the investment risk
Which statement about a whole life policy is correct?
Which statement about a whole life policy is correct?
- Beneficiary may be changed only with the consent of the premium payor
- Death benefit can usually be adjusted
- Premiums are flexible
- Cash value may be borrowed against (correct)
Which statement is correct regarding the premium payment schedule for whole life policies?
Which statement is correct regarding the premium payment schedule for whole life policies?
- Premiums are payable throughout the insured's lifetime/coverage lasts until death of the insured (correct)
- Premiums are payable until age 65/coverage lasts a lifetime
- A single premium is paid at time of application/coverage lasts until retirement
- Premiums are payable for a set period/coverage expires at that point
A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as?
A life policy with a death benefit that can fluctuate according to the performance of its underlying investment portfolio is referred to as?
What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?
What type of life policy has a death benefit that adjusts periodically and is written for a specific period of time?
How does a typical Variable Life Policy investment account grow?
How does a typical Variable Life Policy investment account grow?
S is covered by a whole life policy. Which insurance product can cover his children?
S is covered by a whole life policy. Which insurance product can cover his children?
When is the face amount paid under a Joint Life and Survivor policy?
When is the face amount paid under a Joint Life and Survivor policy?
What type of life policy covers two people and pays upon the death of the last insured?
What type of life policy covers two people and pays upon the death of the last insured?
Which of these characteristics is consistent with a Straight Life policy?
Which of these characteristics is consistent with a Straight Life policy?
Which is true concerning a Variable Universal Life policy?
Which is true concerning a Variable Universal Life policy?
Which type of life policy contains a monthly mortality charge as well as self-directed investment choices?
Which type of life policy contains a monthly mortality charge as well as self-directed investment choices?
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?
A potential client, age 40, would like to purchase a Whole Life policy that will accumulate cash value at a faster rate in the early years of the policy. Which of these statements made by the producer would be correct?
Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?
Which of these types of life insurance allows the policyowner to have level premiums and to also choose from a selection of investment options?
Additional coverage can be added to a Whole Life policy by adding a(n):
Additional coverage can be added to a Whole Life policy by adding a(n):
Study Notes
Life Insurance Policies Overview
- Variable Insurance Policy: Guarantees a minimum return but does not ensure returns on investment accounts or allow policyholders to take on investment risk.
- Whole Life Policy: Cash value can be borrowed against; premiums are paid throughout the insured's lifetime until death.
- Premium Payment Schedules: Whole life policies have premiums payable for the insured's entire life, ensuring coverage lasts until death.
Types of Life Insurance Policies
- Variable Life Insurance: Offers fluctuating death benefits based on the performance of an underlying investment portfolio.
- Decreasing Term Policy: Death benefit adjusts periodically and is issued for a specified time frame.
- Survivorship Policy: Covers two individuals, paying out upon the death of the last insured.
Investment Accounts and Growth
- Growth of Variable Life Policy: Investment accounts typically grow through mutual funds, stocks, and bonds, offering potential for higher returns.
Riders and Additional Coverage
- Child Term Rider: Coverage option specifically for policyholder's children.
- Decreasing Term Rider: Accessible by adding to a Whole Life policy for additional temporary coverage.
Unique Features of Policies
- Joint Life and Survivor Policy: Face amount is paid upon the last insured's death.
- Straight Life Policy: Premiums are maintained for the duration of coverage; no adjustments to premium or death benefits permitted.
- Variable Universal Life Policy: Allows policyholders control over investment directions and premium amounts.
Cash Value Accumulation
- 20-Pay Life Policy: Suitable for those who want faster cash value accumulation compared to Straight Life.
- Impact of Insurer's Financial Rating: Determines cash value accumulation rates in both Straight Life and 20-Pay Life policies.
Premium and Investment Choices
- Variable Life Policy Features: Characterized by level premiums combined with a range of investment options and higher growth potential.
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Description
Test your knowledge on life insurance policies through these flashcards focused on provisions, options, and riders. Each card offers a term and a definition to enhance your understanding of variable and whole life policies. Perfect for exam preparation!
