XCEL USES OF LIFE INSURANCE ACTUAL
EXAM SCRIPT QUESTIONS AND ANSWERS
FULLY REVIEWED MATERIAL
●● When a ten year renewable term life insurance policy issued at age
45 is renewed, the premium rate will be the current rate for
Answer: Ten year term insurance for a person aged 55
●● When would evidence of insurability be required for a person
already covered with a variable universal life policy?
Answer: When the death benefit is increased
●● Assets that back the non-guaranteed values of variable life insurance
products are held in which account?
Answer: Separate account set up by the insurer
●● Which of these statements accurately portrays an adjustable life
insurance policy?
Answer: Policy can alternate between forms of term and whole life
insurance
●● John received a one-time distribution of $50,000 from his modified
endowment contract (MEC). Prior to that, the contact's cash value was
, $150,000, the contract investment amount was $100,000, and the death
benefit was $500,000. What percentage of the $50,000 distribution was
taxable as ordinary income?
Answer: 100%
●● How long does protection normally extend to under a limited pay
whole life policy?
Answer: Until age 100
●● When can a life insurance policy be issued WITHOUT the insured's
consent?
Answer: When a parent purchases a policy on the life of a minor child
●● Which of the following is a TRUE statement regarding universal life
insurance?
Answer: Policy indicates how much of each premium is used toward
company expenses
●● All of these are considered feature of whole life insurance EXCEPT
Answer: Initial premium is lower than for an equivalent amount of term
insurance
EXAM SCRIPT QUESTIONS AND ANSWERS
FULLY REVIEWED MATERIAL
●● When a ten year renewable term life insurance policy issued at age
45 is renewed, the premium rate will be the current rate for
Answer: Ten year term insurance for a person aged 55
●● When would evidence of insurability be required for a person
already covered with a variable universal life policy?
Answer: When the death benefit is increased
●● Assets that back the non-guaranteed values of variable life insurance
products are held in which account?
Answer: Separate account set up by the insurer
●● Which of these statements accurately portrays an adjustable life
insurance policy?
Answer: Policy can alternate between forms of term and whole life
insurance
●● John received a one-time distribution of $50,000 from his modified
endowment contract (MEC). Prior to that, the contact's cash value was
, $150,000, the contract investment amount was $100,000, and the death
benefit was $500,000. What percentage of the $50,000 distribution was
taxable as ordinary income?
Answer: 100%
●● How long does protection normally extend to under a limited pay
whole life policy?
Answer: Until age 100
●● When can a life insurance policy be issued WITHOUT the insured's
consent?
Answer: When a parent purchases a policy on the life of a minor child
●● Which of the following is a TRUE statement regarding universal life
insurance?
Answer: Policy indicates how much of each premium is used toward
company expenses
●● All of these are considered feature of whole life insurance EXCEPT
Answer: Initial premium is lower than for an equivalent amount of term
insurance
