Alabama Life and Health Insurance
Exam
a policy owner can collect the face amount on what type of policy? ANS: endowment policy
the option to convert term life insurance to a permanent form of coverage can normally be executed
ANS: without proof of insurability
with term life insurance, which of the following types of premium remains the same for the entire policy
period? ANS: level premium
mortgage protection is typically covered with: ANS: decreasing term
with renewable term insurance ANS: the premium increases at renewal
paula has an insurance policy that has a guaranteed minimum cash value, a guaranteed death benefit,
fixed premiums, and grows at a rate reflected by a selected fund index. which type of life policy fits this
description? ANS: equity indexed life
what does renewable term guarantee ANS: The insured's insurability
an insurance producer must have which of the following in order to sell variable life insurance policies
ANS: registered with the FINRA, license for variable life and annuities contracts, and a valid insurance
license.
which of the following life insurance policies will build up cash value the fastest ANS: single premium
at what age is an insured for life insurance considered statistically "dead" ANS: 100
,michael has a universal life policy with an increasing death benefit option. with the initial face amount of
$50,000 and a value of $5,000, what would the actual death benefit be? ANS: $55,000
which type of life insurance policy combines insurance protection with an accumulation of cash value
ANS: permanent insurance
tim has a universal life policy. the cash value growth in his policy is: ANS: interest sensitive
in which of the following ways does term life insurance and whole life insurance differ? ANS: term life
insurance does not build cash value
which type of policy allows the policyowner to switch to permanent insurance ANS: convertible term
which of these statements accurately portray a whole life policy ANS: endows at age 100 and paid up a
stated time
at what point does a whole life policy pay the face amount ANS: upon the insureds death or reaching
age 100
which describes a level term policy? ANS: the premium and protection remain constant for the term of
the policy
albert surrenders his whole life policy ten years after it was purchased. what can he expect? ANS: to pay
taxes on the cash value in excess of the premium paid
a husband and wife purchases a life insurance policy that covers both of them. the policy paid nothing
when the husband died. two years later, the wife dies and a death benefit is paid to the beneficiary.
which type of policy is this? ANS: survivorship life policy
, which of the following provisions may not be adjusted in an adjustable life policy? ANS: the insured
which of the following dividend options allows the continuation of cash value accumulation ANS:
reduced paid-up insurance
ron turned over all rights in his policy to an assignee. this is called ANS: an absolute assignment
an aviation exclusion: ANS: excludes coverage when the insured is riding in certain kids of air travel
which type of assignment transfers a portion of the policy owners right to another party in order to
secure a debt to that party? ANS: collateral assignment
A policyowner with a $100,000 whole life policy has a cash value of $10,000. There is an outstanding
loan of $5,000 and a past-due premium of $250. If the policyowner chooses the reduced paid-up option
and then later dies, what will the beneficiary receive? ANS: the reduced paid-up coverage amount
minus $5,250
which type of life insurance Rider allows a policy owner to increase the level of coverage to keep up with
inflation ANS: cost of living rider
policy dividends for life insurance are ANS: not guaranteed
Rick owns $100,000 life insurance policy with a cash value of 10,000. how much can he borrow up to
ANS: the accumulated cash value ($10,000 less interest)
the automatic premium loan provision is not used in which of the following policies ANS: increasing
term policy
when can a lapse life insurance policy usually be reinstated ANS: within 3-5 years of the policy lapsing
Exam
a policy owner can collect the face amount on what type of policy? ANS: endowment policy
the option to convert term life insurance to a permanent form of coverage can normally be executed
ANS: without proof of insurability
with term life insurance, which of the following types of premium remains the same for the entire policy
period? ANS: level premium
mortgage protection is typically covered with: ANS: decreasing term
with renewable term insurance ANS: the premium increases at renewal
paula has an insurance policy that has a guaranteed minimum cash value, a guaranteed death benefit,
fixed premiums, and grows at a rate reflected by a selected fund index. which type of life policy fits this
description? ANS: equity indexed life
what does renewable term guarantee ANS: The insured's insurability
an insurance producer must have which of the following in order to sell variable life insurance policies
ANS: registered with the FINRA, license for variable life and annuities contracts, and a valid insurance
license.
which of the following life insurance policies will build up cash value the fastest ANS: single premium
at what age is an insured for life insurance considered statistically "dead" ANS: 100
,michael has a universal life policy with an increasing death benefit option. with the initial face amount of
$50,000 and a value of $5,000, what would the actual death benefit be? ANS: $55,000
which type of life insurance policy combines insurance protection with an accumulation of cash value
ANS: permanent insurance
tim has a universal life policy. the cash value growth in his policy is: ANS: interest sensitive
in which of the following ways does term life insurance and whole life insurance differ? ANS: term life
insurance does not build cash value
which type of policy allows the policyowner to switch to permanent insurance ANS: convertible term
which of these statements accurately portray a whole life policy ANS: endows at age 100 and paid up a
stated time
at what point does a whole life policy pay the face amount ANS: upon the insureds death or reaching
age 100
which describes a level term policy? ANS: the premium and protection remain constant for the term of
the policy
albert surrenders his whole life policy ten years after it was purchased. what can he expect? ANS: to pay
taxes on the cash value in excess of the premium paid
a husband and wife purchases a life insurance policy that covers both of them. the policy paid nothing
when the husband died. two years later, the wife dies and a death benefit is paid to the beneficiary.
which type of policy is this? ANS: survivorship life policy
, which of the following provisions may not be adjusted in an adjustable life policy? ANS: the insured
which of the following dividend options allows the continuation of cash value accumulation ANS:
reduced paid-up insurance
ron turned over all rights in his policy to an assignee. this is called ANS: an absolute assignment
an aviation exclusion: ANS: excludes coverage when the insured is riding in certain kids of air travel
which type of assignment transfers a portion of the policy owners right to another party in order to
secure a debt to that party? ANS: collateral assignment
A policyowner with a $100,000 whole life policy has a cash value of $10,000. There is an outstanding
loan of $5,000 and a past-due premium of $250. If the policyowner chooses the reduced paid-up option
and then later dies, what will the beneficiary receive? ANS: the reduced paid-up coverage amount
minus $5,250
which type of life insurance Rider allows a policy owner to increase the level of coverage to keep up with
inflation ANS: cost of living rider
policy dividends for life insurance are ANS: not guaranteed
Rick owns $100,000 life insurance policy with a cash value of 10,000. how much can he borrow up to
ANS: the accumulated cash value ($10,000 less interest)
the automatic premium loan provision is not used in which of the following policies ANS: increasing
term policy
when can a lapse life insurance policy usually be reinstated ANS: within 3-5 years of the policy lapsing
