Question 1

Which statement is correct about whole life insurance?

Accepted Answer

A)   It is cheaper than term life.
B)   It builds up cash value.
C)   The premiums increase with your age.
D)   It is the best choice for most people.
E)   It is the same thing as term life insurance.F) None of the above
G) A) and E)

Question 2

A method of evaluating the cost of life insurance by taking into account the time value of money is called:

Accepted Answer

A)   double indemnity.
B)   guaranteed insurability.
C)   an interest-adjusted index.
D)   the consumer price index.
E)   a present value index.F) A) and E)
G) A) and B)

Question 3

An important provision in every life insurance policy is the right to name your beneficiary.

Accepted Answer

A) True 
 B)False

Question 4

List some of the important provisions found in most life insurance policies.

Accepted Answer

The naming of the beneficiary, the grace...

Question 5

A prime reason for buying an annuity is to:

Accepted Answer

A)   save money for a college education.
B)   start a new business.
C)   accumulate funds to invest in stocks.
D)   give you retirement income for the rest of your life.
E)   get rich quick.F) C) and D)
G) A) and B)

Question 6

What is life insurance? What is its purpose and principle?

Accepted Answer

Life insurance is a contract between an ...

Question 7

The premium for a whole life policy remains constant for as long as an insured lives.

Accepted Answer

A) True 
 B)False

Question 8

Universal life is a whole life policy that combines term insurance and investment elements.

Accepted Answer

A) True 
 B)False

Question 9

Which type of insurance is sometimes called temporary insurance?

Accepted Answer

A)   Whole life insurance
B)   Term insurance
C)   Straight life
D)   Ordinary life
E)   Modified lifeF) A) and E)
G) B) and C)

Question 10

Which of the following attributes would not be used by an Underwriter to determine the appropriate premiums to charge for insurance?

Accepted Answer

A)   Marital status
B)   Gender
C)   Health
D)   Age
E)   OccupationF) C) and D)
G) B) and C)

Question 11

Subject to certain minimums, which life insurance is designed to let you pay premiums at any time in virtually any amount?

Accepted Answer

A)   Whole life
B)   Ordinary life
C)   Universal life
D)   Adjustable life
E)   Variable lifeF) A) and B)
G) A) and D)

Question 12

Group life and credit life insurance are generally permanent forms of insurance.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

How much insurance one should carry is an important question for anyone who owns or intends to buy life insurance.

Accepted Answer

A) True 
 B)False

Question 15

Who has the greatest need for life insurance?

Accepted Answer

A)   Households with small children
B)   Singles living alone
C)   Singles living with parents
D)   Dual income couple
E)   ChildrenF) B) and E)
G) B) and C)

Question 16

If your insurance agent does not give you an interest-adjusted index, your best bet is to:

Accepted Answer

A)   buy the policy anyway.
B)   look for another agent.
C)   tell the agent that you are still thinking.
D)   tell the agent you will buy it later.
E)   complain to the Better Business Bureau.F) A) and D)
G) D) and E)

Question 17

A chartered life underwriter (CLU) is a life insurance agent who has passed a series of college-level examinations on insurance and related subjects.

Accepted Answer

A) True 
 B)False

Question 18

Frank Keating has a life insurance policy that can be exchanged for a whole life policy without a medical examination. Once it has been exchanged, the premiums will increase. What type of term life insurance does Frank likely have?

Accepted Answer

A)   Straight
B)   Renewable
C)   Convertible
D)   Decreasing
E)   AcceleratedF) A) and D)
G) A) and E)

Question 19

The easy method of determining life insurance requirements assumes that your family is:

Accepted Answer

A)   rich.
B)   poor.
C)   typical.
D)   young.
E)   old.F) A) and C)
G) C) and E)

Question 20

The 2001 CSO Table separates the mortality experience by:

Accepted Answer

A)   age.
B)   income level.
C)   occupation.
D)   domicile.
E)   sex.F) All of the above
G) B) and D)

Exam 12: Life Insurance

Universal life is a whole life policy that combines term insurance and investment elements.

Correct AnswerverifiedShow Answer

A method of evaluating the cost of life insurance by taking into account the time value of money is called:

Correct AnswerverifiedShow Answer

The premium for a whole life policy remains constant for as long as an insured lives.

Correct AnswerverifiedShow Answer

The easy method of determining life insurance requirements assumes that your family is:

Correct AnswerverifiedShow Answer

Which type of insurance is sometimes called temporary insurance?

Correct AnswerverifiedShow Answer

List some of the important provisions found in most life insurance policies.

Correct AnswerverifiedThe naming of the beneficiary, the grace...View AnswerShow Answer

A chartered life underwriter (CLU) is a life insurance agent who has passed a series of college-level examinations on insurance and related subjects.

Correct AnswerverifiedShow Answer

How much insurance one should carry is an important question for anyone who owns or intends to buy life insurance.

Correct AnswerverifiedShow Answer

Subject to certain minimums, which life insurance is designed to let you pay premiums at any time in virtually any amount?

Correct AnswerverifiedShow Answer

The 2001 CSO Table separates the mortality experience by:

Correct AnswerverifiedShow Answer

Which of the following attributes would not be used by an Underwriter to determine the appropriate premiums to charge for insurance?

Correct AnswerverifiedShow Answer

If your insurance agent does not give you an interest-adjusted index, your best bet is to:

Correct AnswerverifiedShow Answer

A prime reason for buying an annuity is to:

Correct AnswerverifiedShow Answer

Group life and credit life insurance are generally permanent forms of insurance.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

An important provision in every life insurance policy is the right to name your beneficiary.

Correct AnswerverifiedShow Answer

What is life insurance? What is its purpose and principle?

Correct AnswerverifiedLife insurance is a contract between an ...View AnswerShow Answer

Which statement is correct about whole life insurance?

Correct AnswerverifiedShow Answer

Who has the greatest need for life insurance?

Correct AnswerverifiedShow Answer

Frank Keating has a life insurance policy that can be exchanged for a whole life policy without a medical examination. Once it has been exchanged, the premiums will increase. What type of term life insurance does Frank likely have?

Correct AnswerverifiedShow Answer

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The naming of the beneficiary, the grace...
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Life insurance is a contract between an ...
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