Chapter 3 (215) XCEL Final Exam Prediction Questions & Answers.

Chapter 3 (215) XCEL Final Exam Prediction Questions & Answers. Which type of policy is considered to be overfunded, as stated by IRS guidelines? - CORRECT ANSWER The correct answer is "Modified Endowment Contract". A policy that is overfunded to where it does not meet the 7-pay test is considered a Modified Endowment Contract. A(n) _______ _______ Life policy combines investment choices with a form of Term coverage - CORRECT ANSWER The correct answer is "Variable Universal". Variable Universal Life combines investment choices with a form of Term coverage. A Universal Life policy is sometimes referred to as an unbundled Life Policy because the owner can see the interest earned, expense charges, and the - CORRECT ANSWER cost of insurance Which of these types of policies may NOT have the Automatic Premium Loan provision attached to it? - CORRECT ANSWER Decreasing Term Credit life insurance is typically issued with which of the following types of coverage? - CORRECT ANSWER The correct answer is "Decreasing Term". The type of insurance used for Credit life is typically decreasing term, with the term matched to the length of the loan period. A policy that becomes a Modified Endowment Contract (MEC): - CORRECT ANSWER will lose many of its tax advantages Whole Life insurance policies are contractually guaranteed to provide each of the following, EXCEPT: - CORRECT ANSWER partial withdrawal features beyond a surrender charge period Variable Life products require a producer to - CORRECT ANSWER hold a Life Insurance license and a Securities license A father who dies within 3 years after purchasing a life insurance policy on his infant daughter can have the policy premiums waived under which provision? - CORRECT ANSWER The correct answer is "Payor provision". A payor provision provides that in the event of death or disability of the adult premium payor, the premiums on a juvenile policy will be waived until the insured child reaches a specified age or the maturity date of the contract.