REVIEW SHEET WITH TESTED QUESTIONS
AND COMPLETE SOLUTIONS
●● Insured
Answer: The person whose life is covered by the policy
●● Beneficiary
Answer: The person who receives the death benefit
●● Premium
Answer: Payment made to keep the insurance policy active
●● Term Life Insurance
Answer: Temporary life insurance with no cash value
●● Whole Life Insurance
Answer: Permanent life insurance with cash value and fixed premiums
●● Universal Life Insurance
Answer: Permanent insurance with flexible premiums and adjustable
coverage
, ●● Variable Life Insurance
Answer: Life insurance with investment-based cash value and higher
risk
●● Cash Value
Answer: Savings portion of a permanent life insurance policy
●● Death Benefit
Answer: Money paid to the beneficiary when the insured dies
●● Tax Treatment of Cash Value
Answer: Grows tax-deferred
●● Tax Treatment of Death Benefit
Answer: Usually tax-free
●● Grace Period
Answer: 30-31 days to pay overdue premium
●● Free Look Period (Texas)
Answer: 10 days to cancel a new policy