#1
What is the primary purpose of a life settlement?
To purchase a new life insurance policy
To sell an existing life insurance policy
To transfer ownership of a policy to a family member
To cancel a life insurance policy
#2
In a viatical settlement, who typically purchases the life insurance policy from the policyholder?
Insurance company
Family member
Investor or funding entity
Government agency
#3
Which party receives the proceeds of a life settlement or viatical settlement?
Insurance company
Life settlement broker
Policyholder or their beneficiaries
Viatical settlement provider
#4
What is the primary reason someone might consider a viatical settlement?
To purchase a new life insurance policy
To transfer ownership to a family member
To fund medical expenses or end-of-life care
To increase the face value of the policy
#5
Which party typically pays the life settlement broker's fees?
Policyholder
Investor
Insurance company
Viatical settlement provider
#6
How does a life settlement differ from surrendering a life insurance policy?
In a life settlement, the policyholder receives no payment
Surrendering a policy is only possible after the policy matures
In a life settlement, the policyholder receives a lump sum payment
Surrendering a policy has no financial implications
#7
What is the main difference between a life settlement and a viatical settlement?
The age of the policyholder
The type of life insurance policy
The health condition of the policyholder
The beneficiary designation
#8
What is the role of a life settlement broker in the transaction?
To provide medical treatment to the policyholder
To negotiate the terms of the settlement
To calculate the policy's cash surrender value
To underwrite the policy
#9
What is the viatical settlement provider's role in the transaction?
To assess the policyholder's health
To facilitate the sale of the policy to investors
To determine the cash value of the policy
To issue a new life insurance policy
#10
How does the life settlement process impact the policyholder's life insurance coverage?
The coverage remains unchanged
The coverage is canceled
The coverage is increased
The coverage is transferred to a new policy
#11
In a viatical settlement, what is the primary motivation for the policyholder to sell the policy?
To obtain a higher face value
To fund medical expenses or end-of-life care
To transfer ownership to a family member
To change the beneficiary designation
#12
What is a 'life settlement contract'?
A document that transfers ownership of a life insurance policy
An agreement between the policyholder and the insurance company
A legal contract to sell the policy to investors
A document that cancels a life insurance policy
#13
In a viatical settlement, what is a key factor that affects the settlement amount?
The policyholder's age and life expectancy
The original face value of the life insurance policy
The insurance company's reputation
The policy's surrender charges
#14
What is a key consideration for investors in viatical settlements?
The policyholder's age
The original face value of the policy
The insurance company's reputation
The policy's surrender charges
#15
What is the typical tax treatment for the proceeds of a life settlement?
Tax-free
Tax-deductible
Subject to capital gains tax
Exempt from all taxes
#16
In a viatical settlement, how is the life expectancy of the policyholder determined?
By the insurance company
By a medical professional
By the viatical settlement provider
By the policyholder's family
#17
How does the viatical settlement industry impact the life insurance market?
It increases the availability of life insurance policies
It has no impact on the life insurance market
It decreases the availability of life insurance policies
It only impacts specific policy types
#18
What is the primary factor considered in determining the viatical settlement payout?
The insurance company's reputation
The original face value of the policy
The policyholder's age and life expectancy
The policy's cash surrender value