#1
Which of the following is NOT a type of life insurance?
Term life insurance
Whole life insurance
Health insurance
Universal life insurance
#2
What is the primary purpose of life insurance?
To provide retirement income
To protect against financial loss resulting from death
To fund college education
To purchase a new home
#3
What is the purpose of a beneficiary designation in a life insurance policy?
To determine the premium amount
To specify who receives the death benefit
To choose the type of life insurance policy
To set the policy term
#4
Which of the following factors typically affects the cost of life insurance premiums?
Marital status
Gender
Occupation
All of the above
#5
What is the difference between term life insurance and whole life insurance?
Term life insurance has a fixed premium, while whole life insurance has a flexible premium.
Term life insurance provides coverage for a specific period, while whole life insurance covers the insured's entire life.
Term life insurance has a cash value component, while whole life insurance does not.
Term life insurance offers higher death benefits compared to whole life insurance.
#6
Which of the following statements about the death benefit in life insurance is true?
It is paid to the policyholder while they are alive.
It is only available in term life insurance policies.
It is the amount of money paid to the beneficiary upon the death of the insured.
It remains constant throughout the life of the policy.
#7
What is the surrender value of a life insurance policy?
The amount the insured receives if they cancel the policy before maturity
The amount paid to the beneficiary upon the death of the insured
The total premium amount paid over the life of the policy
The cash value of the policy at the time of surrender
#8
Which of the following statements about term life insurance is true?
It has a cash value component
It provides coverage for a specific period of time
It is also known as permanent life insurance
It is typically more expensive than whole life insurance
#9
What is a cash value in a life insurance policy?
The amount of money paid out upon the death of the insured
The premium amount paid by the policyholder
The savings component that grows over time
The maximum amount the insurance company will pay for a claim
#10
What is the main advantage of purchasing life insurance at a young age?
Lower premiums
Higher death benefit
Immediate coverage
More investment options
#11
What is the purpose of a life insurance trust?
To lower the cost of life insurance premiums
To ensure the death benefit is paid to the policyholder's estate
To provide financial support to the insured during their lifetime
To manage and distribute life insurance proceeds according to the insured's wishes
#12
What is the significance of the underwriting process in life insurance?
It determines the type of life insurance policy suitable for the insured.
It calculates the premium amount based on the insured's risk profile.
It determines the death benefit amount of the policy.
It determines the investment options available within the policy.
#13
Which of the following life insurance riders provides additional coverage for specific events like accidental death or disability?
Cash value rider
Accelerated death benefit rider
Accidental death and dismemberment rider
Long-term care rider
#14
What is the purpose of the incontestability clause in a life insurance policy?
To provide a grace period for premium payment
To allow the policyholder to convert term insurance to permanent insurance
To prevent the insurance company from contesting the validity of the policy after a certain period
To specify the circumstances under which the policyholder can borrow against the policy's cash value
#15
Which of the following is a feature of universal life insurance?
Fixed premiums and death benefits
Flexible premiums and death benefits
No cash value component
Guaranteed cash value growth
#16
Which of the following is a tax advantage of life insurance?
Tax-deductible premiums
Tax-free death benefit
Tax-free dividends
Tax-deferred cash value growth
#17
What is the primary advantage of purchasing a life insurance policy with a guaranteed insurability rider?
It allows the insured to change beneficiaries at any time.
It guarantees the insured's insurability for future coverage without requiring additional underwriting.
It provides a higher death benefit compared to standard policies.
It ensures the policy remains in force even if premiums are not paid.
#18
What is the primary difference between whole life insurance and universal life insurance?
Whole life insurance has flexible premiums, while universal life insurance has fixed premiums
Whole life insurance offers higher death benefits compared to universal life insurance
Whole life insurance does not have a cash value component, while universal life insurance does
Whole life insurance provides lifetime coverage, while universal life insurance offers coverage for a specified period
#19
What is the primary benefit of a joint life insurance policy?
Lower premiums compared to individual policies
Higher death benefit compared to individual policies
Ability to insure multiple people under a single policy
Guaranteed cash value growth