AAMS_Latest Real Exam
2026-2027
Master Exam Prep Bundle
(Verified Questions & Answers)
A+ Grade Guaranteed
,Which of these statements is most accurate with respect to Total life insurance requirements may decrease as an individual approaches
the life insurance needs of the typical family? retirement
Assume a client has $30,000 in a money market fund, $8,000
$2,000 in a checking account, a mortgage loan of
$110,000 (not to be paid off, as it will be transferred to the
spouse), an auto loan of $20,000, and credit card balances
of $5,000. Assume that if he died, postmortem expenses
would be $15,000. What would be the cash requirements
for this client?
An investment professional is assessing the life insurance $615,000
needs of the Robinson family. Mr. Robinson has
determined that the family's immediate cash flow
requirements in the event of his death are $65,000. The
amount needed to meet all future funding requirements
(net of Mrs. Robinson's income and Social Security and
pension benefits) is estimated to be $550,000. The family
owns a home in which their equity interest is $200,000.
Based upon these figures, the investment professional
would recommend life insurance with a face amount of:
With regard to financial planning, many individuals and disability income and long-term care insurance
households overlook the potential needs for:
Mrs. Bartlett purchased a life insurance policy that will pay term life insurance policy
$100,000 to her beneficiary should she die at any time
during the next year. The policy guarantees the right to
renew every year for the next five years, and builds no
cash value. Mrs. Bartlett has purchased a
Which types of clients would be identified as the best Clients who prefer the discipline of regular, periodic investments
prospect for cash value life insurance?
With respect to cash value life policies, what part of the The amount of the cash value that exceeds the investment in the contract
policy value, if any, is subject to income taxation when the
policy is surrendered?
Brenda Bradford is the owner of a whole life policy on her Brenda, the policy owner
husband, Rolf. Their daughter, Vera, is named in the policy
as the contingent beneficiary. In issuing the policy, the
insurance company has asked that a settlement option be
selected. Which one of the following individuals is currently
empowered to make the selection?
Your client, Ann, age 50, received a $300,000 inheritance Single-premium deferred annuity
from her late parents' estate. She would like to invest this
money in a safe place, where it will grow in value until she
takes early retirement at age 60. Which one of the
following would be the most logical choice for Ann?
Ten years ago, June, age 58, purchased a deferred Can avoid the tax and the penalty by making a section 1035 exchange
annuity with a fixed rate of return of 4%. She believes that
she could do better if she had a variable annuity with
performance tied to the stock market. June has held on to
this fixed-rate annuity out of fear that surrendering it would
trigger a taxable event and a possible penalty. You should
explain that she:
If disability insurance premiums are paid with pretax be subject to income tax
dollars, any benefits received would:
, Universal life insurance gives the policyowner the ability to mortality rates
adjust all of the following except:
A beneficiary who is guaranteed payments for life (with a Life income with period certain
minimum guarantee of 10 years of payments) has selected
which one of the following settlement options?
Which of the following classes of life insurance has a death Term life insurance
benefit only, increasing premiums temporary coverage,
and expires at the end of a given period of time?
Dividends received from a participating life insurance a return of unused premium payments
policy are:
Assume that a client has the following needs and Variable Universal Life
objectives when purchasing a life insurance policy:
1. flexible premium payments
2. possibility of increasing death benefit
3. investment options
4. permanent protection
Which type of policy is most suitable for this client?
Life insurance can be used to address all of the following third-party ownership
needs except:
1. payment of estate taxes
2. third-party ownership
3. replacement of a deceased spouse's income
4. care of aging parents
The amount of life insurance an individual needs is equal Total of the cash requirements needed to pay off debts and final expenses plus
to the: replace lost income
Jim has selected to receive only the interest from his interest-only option
mother's life insurance policy. When Jim dies, his children
will receive the lump-sum benefit in addition to the benefit
from his life insurance policy. Jim has selected the
In the early years of his or her business, a self-employed term life insurance
individual may be a good candidate for:
Generally, loans taken against the cash value of an in- not currently taxable
force life insurance policy (not classified as a MEC) are
Michelle purchases an annuity that offers a guaranteed an equity-indexed annuity
minimum interest rate and a guarantee against loss of
principal if the contract is held to term. However, if the S&P
500 moves upward, Michelle's annuity might end up
accruing more than the guaranteed minimum interest rate.
Michelle has purchased
An individual who owns an annuity has elected to receive straight life income option
income for life. After receiving payments for five months,
she dies and payments cease, with no additional
payments to beneficiaries. She elected which annuity
income option?
A Section 1035 exchange is not permitted from: an annuity to a cash value life insurance policy
2026-2027
Master Exam Prep Bundle
(Verified Questions & Answers)
A+ Grade Guaranteed
,Which of these statements is most accurate with respect to Total life insurance requirements may decrease as an individual approaches
the life insurance needs of the typical family? retirement
Assume a client has $30,000 in a money market fund, $8,000
$2,000 in a checking account, a mortgage loan of
$110,000 (not to be paid off, as it will be transferred to the
spouse), an auto loan of $20,000, and credit card balances
of $5,000. Assume that if he died, postmortem expenses
would be $15,000. What would be the cash requirements
for this client?
An investment professional is assessing the life insurance $615,000
needs of the Robinson family. Mr. Robinson has
determined that the family's immediate cash flow
requirements in the event of his death are $65,000. The
amount needed to meet all future funding requirements
(net of Mrs. Robinson's income and Social Security and
pension benefits) is estimated to be $550,000. The family
owns a home in which their equity interest is $200,000.
Based upon these figures, the investment professional
would recommend life insurance with a face amount of:
With regard to financial planning, many individuals and disability income and long-term care insurance
households overlook the potential needs for:
Mrs. Bartlett purchased a life insurance policy that will pay term life insurance policy
$100,000 to her beneficiary should she die at any time
during the next year. The policy guarantees the right to
renew every year for the next five years, and builds no
cash value. Mrs. Bartlett has purchased a
Which types of clients would be identified as the best Clients who prefer the discipline of regular, periodic investments
prospect for cash value life insurance?
With respect to cash value life policies, what part of the The amount of the cash value that exceeds the investment in the contract
policy value, if any, is subject to income taxation when the
policy is surrendered?
Brenda Bradford is the owner of a whole life policy on her Brenda, the policy owner
husband, Rolf. Their daughter, Vera, is named in the policy
as the contingent beneficiary. In issuing the policy, the
insurance company has asked that a settlement option be
selected. Which one of the following individuals is currently
empowered to make the selection?
Your client, Ann, age 50, received a $300,000 inheritance Single-premium deferred annuity
from her late parents' estate. She would like to invest this
money in a safe place, where it will grow in value until she
takes early retirement at age 60. Which one of the
following would be the most logical choice for Ann?
Ten years ago, June, age 58, purchased a deferred Can avoid the tax and the penalty by making a section 1035 exchange
annuity with a fixed rate of return of 4%. She believes that
she could do better if she had a variable annuity with
performance tied to the stock market. June has held on to
this fixed-rate annuity out of fear that surrendering it would
trigger a taxable event and a possible penalty. You should
explain that she:
If disability insurance premiums are paid with pretax be subject to income tax
dollars, any benefits received would:
, Universal life insurance gives the policyowner the ability to mortality rates
adjust all of the following except:
A beneficiary who is guaranteed payments for life (with a Life income with period certain
minimum guarantee of 10 years of payments) has selected
which one of the following settlement options?
Which of the following classes of life insurance has a death Term life insurance
benefit only, increasing premiums temporary coverage,
and expires at the end of a given period of time?
Dividends received from a participating life insurance a return of unused premium payments
policy are:
Assume that a client has the following needs and Variable Universal Life
objectives when purchasing a life insurance policy:
1. flexible premium payments
2. possibility of increasing death benefit
3. investment options
4. permanent protection
Which type of policy is most suitable for this client?
Life insurance can be used to address all of the following third-party ownership
needs except:
1. payment of estate taxes
2. third-party ownership
3. replacement of a deceased spouse's income
4. care of aging parents
The amount of life insurance an individual needs is equal Total of the cash requirements needed to pay off debts and final expenses plus
to the: replace lost income
Jim has selected to receive only the interest from his interest-only option
mother's life insurance policy. When Jim dies, his children
will receive the lump-sum benefit in addition to the benefit
from his life insurance policy. Jim has selected the
In the early years of his or her business, a self-employed term life insurance
individual may be a good candidate for:
Generally, loans taken against the cash value of an in- not currently taxable
force life insurance policy (not classified as a MEC) are
Michelle purchases an annuity that offers a guaranteed an equity-indexed annuity
minimum interest rate and a guarantee against loss of
principal if the contract is held to term. However, if the S&P
500 moves upward, Michelle's annuity might end up
accruing more than the guaranteed minimum interest rate.
Michelle has purchased
An individual who owns an annuity has elected to receive straight life income option
income for life. After receiving payments for five months,
she dies and payments cease, with no additional
payments to beneficiaries. She elected which annuity
income option?
A Section 1035 exchange is not permitted from: an annuity to a cash value life insurance policy
