FPQP Module 5 Questions with Correct Answers 100% Verified By Experts| Latest Update
Guaranteed Success
Group Life Insurance single contract that covers a group of people, usually used by
employers to cover employees
Types of Life insurance 1. term life insurance
2. whole life insurance
3. universal life insurance
4. variable life insurance
5. variable universal life insurance
Term Life insurance covers someone for a period of time
Annually Renewable Term Life Insurance covers for one year, premium goes up every year
Decreasing term life insurance premium stays the same while the coverage decreases. used
when someone wants to use the insurance to cover a mortgage or loan repayment
3 factors when determining life insurance premium 1. Mortality- death rate
2. Expenses- insurance operating costs
3. Interest- earnings on premium dollars
Whole Life Insurance insurance that covers someone for their whole life. Premium
payments are added up to a cash value and is tax-deferred.
Limited Payment life insurance Whole life insurance where the insured only pays a premium
up to a certain age. This is good for people who don't want to pay insurance premiums in
retirement.
, Universal life insurance it is a more flexible version of whole life insurance. As long as there
is enough money in the cash value to cover admin fees and cost of insurance, you can make
smaller payments or even skip payments. Can adjust the death benefit higher or lower. As long
as the cash value is enough to cover the cost of insurance and admin fees, the death benefit
shouldn't fall below face value.
Variable Life Insurance designed to combine traditional protection and savings functions of
life insurance with the growth potential of investment securities. The death benefit will never
go below the face value, only go up with the market as long as the fixed premium is paid.
investment choices are made by the insured, not the insurer.
Variable universal life insurance combines characteristics of universal life insurance and
variable life insurance. basically, you can make flexible premium payments, but there is a
possibility that the death benefit could fall below face value depending on the market
performance.
Death benefit of each type of life insurance Term Life- expires at the end of term
Whole Life- fixed and level
Universal- adjustable, level, or increasing options
Variable- varies with investment performance; face value is guaranteed
VUL- adjustable, level, or increasing options
Premiums for each type of life insurance Term Life- fixed schedule, increases at the end of
each term
Whole Life- Fixed schedule, level amount
Universal- Flexible schedule, flexible amount
Variable- fixed schedule, level amount
VUL- flexible schedule, flexible amount
Cash values for each type of life insurance Term Life- none
Guaranteed Success
Group Life Insurance single contract that covers a group of people, usually used by
employers to cover employees
Types of Life insurance 1. term life insurance
2. whole life insurance
3. universal life insurance
4. variable life insurance
5. variable universal life insurance
Term Life insurance covers someone for a period of time
Annually Renewable Term Life Insurance covers for one year, premium goes up every year
Decreasing term life insurance premium stays the same while the coverage decreases. used
when someone wants to use the insurance to cover a mortgage or loan repayment
3 factors when determining life insurance premium 1. Mortality- death rate
2. Expenses- insurance operating costs
3. Interest- earnings on premium dollars
Whole Life Insurance insurance that covers someone for their whole life. Premium
payments are added up to a cash value and is tax-deferred.
Limited Payment life insurance Whole life insurance where the insured only pays a premium
up to a certain age. This is good for people who don't want to pay insurance premiums in
retirement.
, Universal life insurance it is a more flexible version of whole life insurance. As long as there
is enough money in the cash value to cover admin fees and cost of insurance, you can make
smaller payments or even skip payments. Can adjust the death benefit higher or lower. As long
as the cash value is enough to cover the cost of insurance and admin fees, the death benefit
shouldn't fall below face value.
Variable Life Insurance designed to combine traditional protection and savings functions of
life insurance with the growth potential of investment securities. The death benefit will never
go below the face value, only go up with the market as long as the fixed premium is paid.
investment choices are made by the insured, not the insurer.
Variable universal life insurance combines characteristics of universal life insurance and
variable life insurance. basically, you can make flexible premium payments, but there is a
possibility that the death benefit could fall below face value depending on the market
performance.
Death benefit of each type of life insurance Term Life- expires at the end of term
Whole Life- fixed and level
Universal- adjustable, level, or increasing options
Variable- varies with investment performance; face value is guaranteed
VUL- adjustable, level, or increasing options
Premiums for each type of life insurance Term Life- fixed schedule, increases at the end of
each term
Whole Life- Fixed schedule, level amount
Universal- Flexible schedule, flexible amount
Variable- fixed schedule, level amount
VUL- flexible schedule, flexible amount
Cash values for each type of life insurance Term Life- none
