DLD Insurance Commission VUL Reviewer
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Questions and Answers

Which of the following statements about option to top-up under variable life insurance products is FALSE?

  • To top-up a policy, the policyowner pays further single premium at the time of top-up.
  • Policyowner may buy additional units in the variable life fund and these units will be allocated to new variable life insurance policies. (correct)
  • Further premiums at time of top-up will be used in full, after deducting charges for topups, to purchase additional units of the variable life funds.
  • Policyowners are normally allowed to top-up their policies at any time, subject to a minimum amount

    • What are the disadvantages when investing in common shares? I. Dividends are paid not more than fixed rates. II. Investors are exposed to market and specific risks. III. Shares can become worthless if company becomes insolvent.

  • I, and II
  • I, and III
  • II, and III (correct)
  • I, III, and III

    • Which of the following statements about the flexibility features of variable life policies is FALSE?

  • Policyholders may request for a partial withdrawal of the policy and the withdrawal amount will be met by cashing the units at bid price.
  • Policyholders can take loans against their variable life policies up to the entire withdrawal value of their policies. (correct)
  • Policyholders have the flexibility of switching from one fund to another, provided it satisfies the company’s switching criteria.
  • Policyholders have the flexibility of increasing or decreasing their premiums for regular premiums variable life policies.

    • What is the most suitable investment instrument for someone who is interested in protecting his principal, while receiving a steady stream of income?

    <p>Fixed income securities</p> Signup and view all the answers

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