Life & Health Insurance Exam Colorado Questions and Correct Answers 2025/2026

Life & Health Insurance Exam Colorado Questions and Correct Answers 2025/2026 Traditional Whole Life - Answer --Ordinary (Straight) Life -Limited-Pay & Single-Premium Whole Life -Adjustable Whole Life Ordinary (Straight) Life - Answer --Until 100 or Death, whichever comes first -Permanent Protection -Rates & benefits based on law of large numbers (Mortality Rate) -Guaranteed, tax-deferred interest rate -Premium level, company's risk goes down as cash value goes up -Insurer keeps the cash value if death to offset risk -Lowest net cost in long run -Client has access to cash through cash surrender or policy loan -Rates are per unit of protection (1,000 is 1 unit)---TEST -Cash value is guaranteed -Cash value will equal face amount at policy maturityLimited-Pay & Single-Premium Whole Life - Answer --Premium paying period is shorter -Cash value still equals face amount at age 100 -20 pay life will be paid up in 20 years PL -Life Paid up at age 65, will be paid up at 65 LP -A single premium policy will have an immediate cash value (1-pay life)-- -TEST Adjustable Whole Life----TEST - Answer --Sold to clients with fluctuating incomes----TEST -Combination of term and whole life----TEST -Coverage may not be increased without physical exam---TEST Interest/Market Sensitive Whole Life Products - Answer --Universal Whole life -Variable Whole life -Variable/Universal Whole life -Equity-Indexed Life Universal Whole life - Answer --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 - Answer --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 Industr