Exam FX - MS Life Quiz Questions
with Answers
All of the following are TRUE regarding the covertibility option under a term
life insurance policy - -- most term policies contain a convertibility option
- upon conversion, the premium for the permanent policy will be based upon
the attained age
- evidence of insurability is not required
- What is the purpose of establishing the target premium for a universal life
policy? - -to keep the policy in force
- All other factors being equal, the least expensive first-year premium
payment is found in - -annually renewable term
- Level term insurance provides a level death benefit and a level premium
during the policy term. If the policy renews at the end of a specified period of
time, the policy premium will be - -Adjusted by the insured's age at the time
of renewal
- Which of the following is incorrect regarding a $100,0000 20-year level
term policy?
A) At the end of 20 years, the policy's cash value will equal $100,000
B) the policy premiums will remain level for 20 years
C) if the insured dies before the policy expired, the beneficiary willl receive
$100,000
D) the policy will expire at the end of the 20-year period - -ANSWER: (A) At
the end of 20 years, the policy's cash value will equal $100,000
- Which of the following is an example of a limited-pay life policy? - -Life
Paid-up at Age 65
- Which of the following is NOT a type of whole life insurance?
A) Increasing
B) Single Premium
C) Straight life
D) Limited Payment - -ANSWER (A) Increasing term
- What are the two components of a universal life policy? - -Insurance and
cash account
- Which policy component decreases in decreasing term insurance? - -Face
amount
, - Both Universal Life and Variable Universal Life have a - -Flexible premium
- Which of the following policies would be classified as a traditional level
premium contract? - -Straight Life
- To sell variable life insurance policies, an agent must receive all of the
following EXCEPT
A) a FINRA registration
B) a securities license
C) a life insurance licenses
D) a SEC registration - -ANSWER: (D) a SEC registration
- Which of the following is another term for the accumulation period of an
annuity? - -Pay-in period
- Which of the following has the right to convert the existing term coverage
to permanent insurance? - -Policyowner
- A married couple owns a permanent policy which covers both of their lives
and pays the death benefit only upon the death of the first insured. Which
policy is that? - -Joint Life Policy
- Which kind of policy allows withdrawals or partial surrenders? - -Universal
life
- Variable Life insurance is based on what kind of premium? - -Level fixed
- Which of the following types of policies allows the policyowner to skip
premium payments, provided that there is enough cash value in the policy to
cover the premium account? - -Universal life
- Which of the following types of insurance policies would provide the
greatest amount of protection for a temporary period during which an
insured will have limited financial resources? - -Term
- In an annuity, the accumulated money is converted into a stream of
income during which time period? - -Annuitization period
- An individual has just borrowed $10,000 from his bank on a 5-year
installment loan requiring monthly payments. What type of insurance policy
would be best suited to this situation? - -Decreasing term
- An insured buys a 5-year level premium term policy with a face amount of
$10,000. The policy also contains renewability and covertibility options.
When the insured renews the policy in 5 years, what will happen to the
with Answers
All of the following are TRUE regarding the covertibility option under a term
life insurance policy - -- most term policies contain a convertibility option
- upon conversion, the premium for the permanent policy will be based upon
the attained age
- evidence of insurability is not required
- What is the purpose of establishing the target premium for a universal life
policy? - -to keep the policy in force
- All other factors being equal, the least expensive first-year premium
payment is found in - -annually renewable term
- Level term insurance provides a level death benefit and a level premium
during the policy term. If the policy renews at the end of a specified period of
time, the policy premium will be - -Adjusted by the insured's age at the time
of renewal
- Which of the following is incorrect regarding a $100,0000 20-year level
term policy?
A) At the end of 20 years, the policy's cash value will equal $100,000
B) the policy premiums will remain level for 20 years
C) if the insured dies before the policy expired, the beneficiary willl receive
$100,000
D) the policy will expire at the end of the 20-year period - -ANSWER: (A) At
the end of 20 years, the policy's cash value will equal $100,000
- Which of the following is an example of a limited-pay life policy? - -Life
Paid-up at Age 65
- Which of the following is NOT a type of whole life insurance?
A) Increasing
B) Single Premium
C) Straight life
D) Limited Payment - -ANSWER (A) Increasing term
- What are the two components of a universal life policy? - -Insurance and
cash account
- Which policy component decreases in decreasing term insurance? - -Face
amount
, - Both Universal Life and Variable Universal Life have a - -Flexible premium
- Which of the following policies would be classified as a traditional level
premium contract? - -Straight Life
- To sell variable life insurance policies, an agent must receive all of the
following EXCEPT
A) a FINRA registration
B) a securities license
C) a life insurance licenses
D) a SEC registration - -ANSWER: (D) a SEC registration
- Which of the following is another term for the accumulation period of an
annuity? - -Pay-in period
- Which of the following has the right to convert the existing term coverage
to permanent insurance? - -Policyowner
- A married couple owns a permanent policy which covers both of their lives
and pays the death benefit only upon the death of the first insured. Which
policy is that? - -Joint Life Policy
- Which kind of policy allows withdrawals or partial surrenders? - -Universal
life
- Variable Life insurance is based on what kind of premium? - -Level fixed
- Which of the following types of policies allows the policyowner to skip
premium payments, provided that there is enough cash value in the policy to
cover the premium account? - -Universal life
- Which of the following types of insurance policies would provide the
greatest amount of protection for a temporary period during which an
insured will have limited financial resources? - -Term
- In an annuity, the accumulated money is converted into a stream of
income during which time period? - -Annuitization period
- An individual has just borrowed $10,000 from his bank on a 5-year
installment loan requiring monthly payments. What type of insurance policy
would be best suited to this situation? - -Decreasing term
- An insured buys a 5-year level premium term policy with a face amount of
$10,000. The policy also contains renewability and covertibility options.
When the insured renews the policy in 5 years, what will happen to the
