Chapter 5 quiz

Interest-sensitive whole life

An insured purchased a life insurance policy, the agent told him that depending upon the company’s investments and expense factors, the cash values couold change from those shown in the policy at issue time. What policy is this

Indeterminate period

The premium is guaranteed for an initial period and then the insurer can charge up to a maximum premium charge in what type of policy

The type of investment

In an adjustable life policy of all of the following can be changed by the policy owner EXCEPT

The length of coverage

The premium

The type of investment

The amount of insurance

Life paid-up at age 65

Which of the following is an example of a limited-pay life policy

Level Term Life

Straight Life

Life paid-up at age 65

Renewable term to age 70

The premiums are invested in the insurer’s general account

All of the following are true about variable products EXCEPT

The cash value is not guaranteed

Policyowners bear the investment risk

The premiums are invested in the insurer’s general account

The minimum death benefit is guaranteed

Providing evidence of insurability

The policyowner of an adjustable life policy wants to increase the death benefit, what would they have to do in order to make this change

Its premium steadily decreases over time, in response to its growing cash value

Which statement is NOT true regarding a straight life policy

The face value of the policy is paid to the insured at age 100

Its premium steadily decreases over time, in response to its growing cash value

It usually develops cash value by the end of the third year policy

It has the lowest annual premium of the three types of whole life policies

The death benefit is fixed

Which of the following is NOT true regarding a variable universal life policy

The death benefit is fixed

The policyowner can participate in some of the investment decisions

The cash values are not guaranteed

The minimum death benefit is not guaranteed