CH#3: Life Insurance Policies Question And Correct Answers
The purpose of the group was to purchase life insurance - ✔✔A group of 15 skydivers met at
a seminar and began talking about life insurance during a break. Because it was expensive to
get individual life insurance, they decided to band together to form a small group so that
they could qualify for group life insurance. After they applied for group life insurance, they
were rejected. Why
A) The group has not been established for long enough.
B) The purpose of the group was to purchase life insurance.
C) Their profession poses too high of a risk for the insurer.
D) There are not enough people in the group to qualify for group life insurance
Adjustable Life - ✔✔At age 30, an applicant wants to start an insurance program, but
realizing that his insurance needs will likely change, he wants a policy that can be modified
to accommodate those changes as they occur. Which of the following policies would most
likely fit his needs
A) Single Premium Whole Life
B) Interest-sensitive Whole Life
C) Decreasing Term
D) Adjustable Life
The cost of coverage is based on the ratio of men and women in the group - ✔✔Which of
the following statements about group life is correct
A) The premiums are higher than in an individual policy because there is no medical exam.
B) The group sponsor receives a Certificate of Insurance.
C) The policy can be converted to an individual term insurance policy.
D) The cost of coverage is based on the ratio of men and women in the group
It is level term insurance - ✔✔Which of the following best describes annually renewable
term insurance
,A) It requires proof of insurability at each renewal.
B) Neither the premium nor the death benefit is affected by the insured's age.
C) It provides an annually increasing death benefit.
D) It is level term insurance
Life Paid-up at Age 65 - ✔✔Which of the following is an example of a limited-pay life policy
A) Renewable Term to Age 70
B) Level Term Life
C) Straight Life
D) Life Paid-up at Age 65
Straight Life - ✔✔Which of the following policies would be classified as a traditional level
premium contract
A) Adjustable Life
B) Universal Life
C) Variable Universal Life
D) Straight Life
Required a premium increase each renewal - ✔✔A man decided to purchase a $100,000
Annually Renewable Term Life policy to provide additional protection until his children
finished college. He discovered that his policy
A) Required a premium increase each renewal.
B) Built cash values.
C) Required proof of insurability every year.
D) Decreased death benefit at each renewal
, A level annual premium for the life of the insured - ✔✔A Straight Life policy has what type
of premium?
A) A decreasing annual premium for the life of the insured
B) A variable annual premium for the life of the insured
C) A level annual premium for the life of the insured
D) An increasing annual premium for the life of the insured
Lower - ✔✔All other factors being equal, what would the premium be like in a survivorship
life policy as compared to the premium in a joint life policy
A) Half the amount
B) Lower
C) Higher
D) As high
$100,000 - ✔✔An individual purchased a $100,000 Joint Life policy on himself and his wife.
Eight years later, he died in an automobile accident. How much will his wife receive from
the policy
A) Nothing
B) $50,000
C) $100,000
D) $200,000
The beneficiary - ✔✔In a group life insurance policy, the employer may select all of the
following EXCEPT
A) The amount of insurance.
B) The premium payor.
C) The beneficiary.
The purpose of the group was to purchase life insurance - ✔✔A group of 15 skydivers met at
a seminar and began talking about life insurance during a break. Because it was expensive to
get individual life insurance, they decided to band together to form a small group so that
they could qualify for group life insurance. After they applied for group life insurance, they
were rejected. Why
A) The group has not been established for long enough.
B) The purpose of the group was to purchase life insurance.
C) Their profession poses too high of a risk for the insurer.
D) There are not enough people in the group to qualify for group life insurance
Adjustable Life - ✔✔At age 30, an applicant wants to start an insurance program, but
realizing that his insurance needs will likely change, he wants a policy that can be modified
to accommodate those changes as they occur. Which of the following policies would most
likely fit his needs
A) Single Premium Whole Life
B) Interest-sensitive Whole Life
C) Decreasing Term
D) Adjustable Life
The cost of coverage is based on the ratio of men and women in the group - ✔✔Which of
the following statements about group life is correct
A) The premiums are higher than in an individual policy because there is no medical exam.
B) The group sponsor receives a Certificate of Insurance.
C) The policy can be converted to an individual term insurance policy.
D) The cost of coverage is based on the ratio of men and women in the group
It is level term insurance - ✔✔Which of the following best describes annually renewable
term insurance
,A) It requires proof of insurability at each renewal.
B) Neither the premium nor the death benefit is affected by the insured's age.
C) It provides an annually increasing death benefit.
D) It is level term insurance
Life Paid-up at Age 65 - ✔✔Which of the following is an example of a limited-pay life policy
A) Renewable Term to Age 70
B) Level Term Life
C) Straight Life
D) Life Paid-up at Age 65
Straight Life - ✔✔Which of the following policies would be classified as a traditional level
premium contract
A) Adjustable Life
B) Universal Life
C) Variable Universal Life
D) Straight Life
Required a premium increase each renewal - ✔✔A man decided to purchase a $100,000
Annually Renewable Term Life policy to provide additional protection until his children
finished college. He discovered that his policy
A) Required a premium increase each renewal.
B) Built cash values.
C) Required proof of insurability every year.
D) Decreased death benefit at each renewal
, A level annual premium for the life of the insured - ✔✔A Straight Life policy has what type
of premium?
A) A decreasing annual premium for the life of the insured
B) A variable annual premium for the life of the insured
C) A level annual premium for the life of the insured
D) An increasing annual premium for the life of the insured
Lower - ✔✔All other factors being equal, what would the premium be like in a survivorship
life policy as compared to the premium in a joint life policy
A) Half the amount
B) Lower
C) Higher
D) As high
$100,000 - ✔✔An individual purchased a $100,000 Joint Life policy on himself and his wife.
Eight years later, he died in an automobile accident. How much will his wife receive from
the policy
A) Nothing
B) $50,000
C) $100,000
D) $200,000
The beneficiary - ✔✔In a group life insurance policy, the employer may select all of the
following EXCEPT
A) The amount of insurance.
B) The premium payor.
C) The beneficiary.
