#1
Which of the following is a feature of term life insurance?
Cash value accumulation
Covers the insured for a specific period
Provides lifelong coverage
Offers investment options
#2
Which of the following is a characteristic of universal life insurance?
Offers fixed premiums and death benefits
Provides coverage for a specific term only
Allows policyholders to adjust premium payments and coverage levels
Does not accumulate cash value
#3
Which of the following is a characteristic of term life insurance?
Provides coverage for a specific term
Builds cash value over time
Offers lifelong coverage
Allows policyholders to borrow against the policy
#4
Which of the following is a characteristic of permanent life insurance?
Provides coverage for a specific term only
Does not have a cash value component
Offers flexible premium payments
Cannot be surrendered for cash value
#5
What is the primary difference between whole life insurance and universal life insurance?
Whole life insurance has fixed premiums, while universal life insurance has flexible premiums.
Whole life insurance offers lifetime coverage, while universal life insurance covers for a specific term only.
Whole life insurance does not have a cash value component, while universal life insurance does.
Whole life insurance provides investment options, while universal life insurance does not.
#6
What does 'cash value' refer to in life insurance?
The money received when a policyholder surrenders their policy
The face value of the policy
The amount of coverage provided by the policy
The premium payment made by the insured
#7
Which of the following is NOT a type of permanent life insurance?
Whole life insurance
Universal life insurance
Term life insurance
Variable life insurance
#8
What is the main difference between whole life insurance and term life insurance?
Whole life insurance provides coverage for a specific term, while term life insurance covers the insured for life
Whole life insurance does not have a cash value component, while term life insurance does
Whole life insurance offers fixed premiums and a cash value component, while term life insurance has flexible premiums and no cash value
There is no difference; both types of insurance offer the same features and benefits
#9
What happens if a policyholder stops paying premiums for their life insurance policy?
The policy is canceled, and the insured receives a refund of premiums paid
The policy remains in force, but with reduced benefits
The policy lapses, and coverage terminates
The policy continues with no changes
#10
What does the 'grace period' in a life insurance policy refer to?
The period during which the policyholder can change beneficiaries
The period during which the insured can file a claim
The period after a missed premium payment when coverage remains in force
The period during which the policyholder can surrender the policy for cash value
#11
In life insurance, what does 'underwriting' refer to?
The process of determining the premiums
The process of assessing risk and determining eligibility
The process of paying out benefits to beneficiaries
The process of canceling a policy
#12
What is the primary purpose of the death benefit in life insurance?
To provide income during retirement
To cover medical expenses
To provide financial protection to beneficiaries
To accumulate cash value
#13
What does the 'incontestability clause' in a life insurance policy typically state?
The insured cannot contest the beneficiary designation
The insurance company cannot contest the claim after a certain period
The premium payments cannot be contested by the insurer
The policyholder can contest the coverage amount
#14
In variable life insurance, where are the premiums invested?
Invested in a fixed-interest account managed by the insurer
Invested in stocks, bonds, or mutual funds chosen by the policyholder
Invested in government bonds only
Invested in real estate properties
#15
Which of the following riders provides additional coverage in case of accidental death?
Waiver of premium rider
Accelerated death benefit rider
Accidental death benefit rider
Long-term care rider