XCEL CHAPTER 4 A EXAM QUESTIONS WITH COMPLETE
SOLUTIONS VERIFIED
Rob purchased a standard whole life policy with a $500,000 death benefit when he
was age 30. His insurance agent told him the policy would be paid up if he
reached age 100. The present cash value of the policy equals $250,000. Rob
recently died at age 60. The death benefit would be
500,000.00
A life insurance policy that has premiums fully paid up within a stated time period
is called
limited payment insurance
A Modified Endowment Contract (MEC) is best described as
A life insurance contract which accumulates cash values higher than the IRS
will allow
Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life
policy covering all three of their lives. If Mike dies first, the policy proceeds
will no longer provide insurance protection
Julie has a $100,000 30-year mortgage on her new home. What type of life
insurance could she purchase that is designed to pay off the loan balance if she
dies within the 30-year period?
Decreasing term insurance
What is the automatic continuance of insurance coverage referred to as?
, renewal
All of these statements concerning whole life insurance are false EXCEPT
When a whole life policy is surrendered, income taxes may be owed
Variable life insurance and Universal life insurance are very similar. Which of
these features are held exclusively by variable universal life insurance?
Policyowner has the right to select the investment which will provide the
greatest return
A securities license is required for a life insurance producer to sell
variable life insurance
Which policy feature makes a universal life policy different from a whole life
policy?
A flexible premium schedule
The least expensive option to pay off a 30-year mortgage balance would be
decreasing term life
Joe has a life insurance policy that has a face amount of $300,000. After a number
of years, the policy's cash value accumulates to $50,000 and the face amount
becomes $350,000. What kind of policy is this?
Universal Life policy
What kind of life insurance policy covers two or more people with the death
benefit payable upon the last person's death?
Last Survivor Life insurance
All of these are characteristics of a universal life insurance policy EXCEPT
Fixed surrender value
SOLUTIONS VERIFIED
Rob purchased a standard whole life policy with a $500,000 death benefit when he
was age 30. His insurance agent told him the policy would be paid up if he
reached age 100. The present cash value of the policy equals $250,000. Rob
recently died at age 60. The death benefit would be
500,000.00
A life insurance policy that has premiums fully paid up within a stated time period
is called
limited payment insurance
A Modified Endowment Contract (MEC) is best described as
A life insurance contract which accumulates cash values higher than the IRS
will allow
Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life
policy covering all three of their lives. If Mike dies first, the policy proceeds
will no longer provide insurance protection
Julie has a $100,000 30-year mortgage on her new home. What type of life
insurance could she purchase that is designed to pay off the loan balance if she
dies within the 30-year period?
Decreasing term insurance
What is the automatic continuance of insurance coverage referred to as?
, renewal
All of these statements concerning whole life insurance are false EXCEPT
When a whole life policy is surrendered, income taxes may be owed
Variable life insurance and Universal life insurance are very similar. Which of
these features are held exclusively by variable universal life insurance?
Policyowner has the right to select the investment which will provide the
greatest return
A securities license is required for a life insurance producer to sell
variable life insurance
Which policy feature makes a universal life policy different from a whole life
policy?
A flexible premium schedule
The least expensive option to pay off a 30-year mortgage balance would be
decreasing term life
Joe has a life insurance policy that has a face amount of $300,000. After a number
of years, the policy's cash value accumulates to $50,000 and the face amount
becomes $350,000. What kind of policy is this?
Universal Life policy
What kind of life insurance policy covers two or more people with the death
benefit payable upon the last person's death?
Last Survivor Life insurance
All of these are characteristics of a universal life insurance policy EXCEPT
Fixed surrender value
