Alabama Life & Health Insurance Exam|
109 Questions & Answers Verified 100%
(GRADED A+)
Term Insurance - ANSWERSTemporary protection because it only provides coverage
for a specific period of time. Also known as pure life insurance
Term insurance provides what is known as _________________ - ANSWERSpure
death protection
Term insurance provides the greatest amount of coverage for the _______________ -
ANSWERSlowest premium
Term insurance has no ____________ - ANSWERScash value
Three basic types of term coverage available, based on how the face amount (death
benefit) changes during the policy term: - ANSWERS1. Level
2. Increasing
3. Decreasing
Level term insurance - ANSWERSMost common type of temporary protection
purchased. The word level refers to the death benefit that does not change throughout
the life of the policy.
Level in level term insurance refers to the ________________, which does NOT change
- ANSWERSdeath benefit
Annually Renewable Term (ART) - ANSWERSthe purest form of term insurance. The
death benefit remains level, and the policy may be guaranteed to be renewable each
year without proof of insurability, but the premium increases annually according to the
attained age, as the probability of death increases.
Level Premium Term - ANSWERSprovides a level death benefit and a level premium
during the policy term.
Increasing term - ANSWERSfeatures level premiums and a death benefit that increases
each year over the duration of the policy term.
Decreasing Term - ANSWERSpolicies feature a level premium and a death benefit that
decreases each year over the duration of the policy term. Nonrenewable
, Renewable Provision - ANSWERSallows the policyowner the right to renew the
coverage at the expiration date without evidence of insurability
Convertible Provision - ANSWERSprovides the policyowner with the right to convert the
policy to a permanent insurance policy without evidence of insurability
Re-entry Option - ANSWERSAn option that gives the insured the opportunity for a
discounted premium rate with proof of insurability
Permanent Life Insurance - ANSWERSA general term used to refer to various forms of
life insurance policies that build cash value and remain in effect for the entire life of the
insured as long as the premium is paid.
Most common type of permanent insurance: - ANSWERSWhole Life
Whole Life Insurance - ANSWERSprovides lifetime protection, and includes a savings
element (or cash value)
Premiums for whole life policies usually are higher than for ___________ -
ANSWERSterm insurance
Level Premium - ANSWERSThe premium for whole life policies is based on the issue
age; therefore, it remains the same throughout the life of the policy.
Death Benefit - ANSWERSthe death benefit is guaranteed and also remains level for
life
Cash Value - ANSWERScreated by the accumulation of premium, is scheduled to equal
the face amount of the policy when the insured reaches age 100 (the policy maturity
date), and is paid out to the policyowner.
Living Benefits - ANSWERSThe policyowner can borrow against the cash value while
the policy is in effect, or can receive the cash value when the policy is surrendered
_______________ provides lifetime (permanent) protection and accumulates cash
value. - ANSWERSWhole life insurance
3 basic forms of whole life insurance: - ANSWERS1. Straight whole life
2. Limited-pay whole life
3. Single premium whole life
Straight Life, Ordinary Life, Continuous Premium Whole Life - ANSWERSbasic whole
life policy. Policyowner pays the premium from the time the policy is issued until the
insured's death or age 100.
109 Questions & Answers Verified 100%
(GRADED A+)
Term Insurance - ANSWERSTemporary protection because it only provides coverage
for a specific period of time. Also known as pure life insurance
Term insurance provides what is known as _________________ - ANSWERSpure
death protection
Term insurance provides the greatest amount of coverage for the _______________ -
ANSWERSlowest premium
Term insurance has no ____________ - ANSWERScash value
Three basic types of term coverage available, based on how the face amount (death
benefit) changes during the policy term: - ANSWERS1. Level
2. Increasing
3. Decreasing
Level term insurance - ANSWERSMost common type of temporary protection
purchased. The word level refers to the death benefit that does not change throughout
the life of the policy.
Level in level term insurance refers to the ________________, which does NOT change
- ANSWERSdeath benefit
Annually Renewable Term (ART) - ANSWERSthe purest form of term insurance. The
death benefit remains level, and the policy may be guaranteed to be renewable each
year without proof of insurability, but the premium increases annually according to the
attained age, as the probability of death increases.
Level Premium Term - ANSWERSprovides a level death benefit and a level premium
during the policy term.
Increasing term - ANSWERSfeatures level premiums and a death benefit that increases
each year over the duration of the policy term.
Decreasing Term - ANSWERSpolicies feature a level premium and a death benefit that
decreases each year over the duration of the policy term. Nonrenewable
, Renewable Provision - ANSWERSallows the policyowner the right to renew the
coverage at the expiration date without evidence of insurability
Convertible Provision - ANSWERSprovides the policyowner with the right to convert the
policy to a permanent insurance policy without evidence of insurability
Re-entry Option - ANSWERSAn option that gives the insured the opportunity for a
discounted premium rate with proof of insurability
Permanent Life Insurance - ANSWERSA general term used to refer to various forms of
life insurance policies that build cash value and remain in effect for the entire life of the
insured as long as the premium is paid.
Most common type of permanent insurance: - ANSWERSWhole Life
Whole Life Insurance - ANSWERSprovides lifetime protection, and includes a savings
element (or cash value)
Premiums for whole life policies usually are higher than for ___________ -
ANSWERSterm insurance
Level Premium - ANSWERSThe premium for whole life policies is based on the issue
age; therefore, it remains the same throughout the life of the policy.
Death Benefit - ANSWERSthe death benefit is guaranteed and also remains level for
life
Cash Value - ANSWERScreated by the accumulation of premium, is scheduled to equal
the face amount of the policy when the insured reaches age 100 (the policy maturity
date), and is paid out to the policyowner.
Living Benefits - ANSWERSThe policyowner can borrow against the cash value while
the policy is in effect, or can receive the cash value when the policy is surrendered
_______________ provides lifetime (permanent) protection and accumulates cash
value. - ANSWERSWhole life insurance
3 basic forms of whole life insurance: - ANSWERS1. Straight whole life
2. Limited-pay whole life
3. Single premium whole life
Straight Life, Ordinary Life, Continuous Premium Whole Life - ANSWERSbasic whole
life policy. Policyowner pays the premium from the time the policy is issued until the
insured's death or age 100.
