Colorado Life & Health Insurance Exam
Study Guide with complete solutions
(Updated).
Term Insurance Rider -Type of Insurance Rider
-Often added to whole life policy to increase coverage
-Some whole, some term
-Term portion will not cover unless insured dies within the term period
Key Employee Life Insurance -Benefits company not person
-Business is beneficiary
-Premiums paid are not tax deductible
-Proceeds paid are not taxable
-In the event that the key employee no longer works for the company,
yet premiums are still paid, and they die, policy proceeds would go to
company--TEST
Other Insured Rider---TEST -Type of Insurance Rider
-Added to whole life policy under certain circumstances
-Adds coverage for new spouse on whole life
-Subject to insurability (Physical Exam)
,-Could be used to add coverage on newborn, on current policy, term
insurance rider on child
Long-Term Care Rider -Type of Insurance Rider
-Costs extra and may be added to a cash value policy
-Allows policy owner to take money out of policy's cash value to pay for
qualifying nursing home or home health care
Return of Premium Rider -Type of Insurance Rider
-Same as term
-Could be added to term depending upon company
-Also called return of premium term insurance (ROPT)
-If insured should live to end of term, premium is returned tax-free
Universal Whole life -Guaranteed minimum interest rates
-Extreme flexibility regarding premium PMTs----TEST
-Most flexible product
-Target premium based on projected earnings
-Option A UL has level death benefits
-Option B UL will pay beneficiary both face amount + cash value
Variable Whole life -Cash value deposited into a separate account
, -Requires FINRA series 6 or 7 to sell
-Used to be called NASD
-Regulated by SEC
-Regulated by FINRA (Financial Industry Regulatory Authority)
-NYSE license not required
-Minimum death benefit (face amount) is guaranteed---TEST
-Has fixed premium---TEST
Variable/Universal Whole life -Requires Finra(series 6 or 7) licenses
to sell
-Allows client to self-direct cash values into sub-account---TEST
-Flexible premium
Equity-Indexed Life -cash value, where minimum death benefit is
guaranteed as well as the minimum earning on the cash value in the
general account
-Securities license is not required
-Fixed Premium
Term Life -Level Term
-Decreasing Term
-Increasing Term
Study Guide with complete solutions
(Updated).
Term Insurance Rider -Type of Insurance Rider
-Often added to whole life policy to increase coverage
-Some whole, some term
-Term portion will not cover unless insured dies within the term period
Key Employee Life Insurance -Benefits company not person
-Business is beneficiary
-Premiums paid are not tax deductible
-Proceeds paid are not taxable
-In the event that the key employee no longer works for the company,
yet premiums are still paid, and they die, policy proceeds would go to
company--TEST
Other Insured Rider---TEST -Type of Insurance Rider
-Added to whole life policy under certain circumstances
-Adds coverage for new spouse on whole life
-Subject to insurability (Physical Exam)
,-Could be used to add coverage on newborn, on current policy, term
insurance rider on child
Long-Term Care Rider -Type of Insurance Rider
-Costs extra and may be added to a cash value policy
-Allows policy owner to take money out of policy's cash value to pay for
qualifying nursing home or home health care
Return of Premium Rider -Type of Insurance Rider
-Same as term
-Could be added to term depending upon company
-Also called return of premium term insurance (ROPT)
-If insured should live to end of term, premium is returned tax-free
Universal Whole life -Guaranteed minimum interest rates
-Extreme flexibility regarding premium PMTs----TEST
-Most flexible product
-Target premium based on projected earnings
-Option A UL has level death benefits
-Option B UL will pay beneficiary both face amount + cash value
Variable Whole life -Cash value deposited into a separate account
, -Requires FINRA series 6 or 7 to sell
-Used to be called NASD
-Regulated by SEC
-Regulated by FINRA (Financial Industry Regulatory Authority)
-NYSE license not required
-Minimum death benefit (face amount) is guaranteed---TEST
-Has fixed premium---TEST
Variable/Universal Whole life -Requires Finra(series 6 or 7) licenses
to sell
-Allows client to self-direct cash values into sub-account---TEST
-Flexible premium
Equity-Indexed Life -cash value, where minimum death benefit is
guaranteed as well as the minimum earning on the cash value in the
general account
-Securities license is not required
-Fixed Premium
Term Life -Level Term
-Decreasing Term
-Increasing Term
