QUESTIONS AND ANSWERS
Pam is the primary beneficiary of a life insurance policy and wants to let the death benefit
accumulate and receive only the monthly investment proceeds. Which settlement option
should she choose? - ANS Interest Option
A creditor would be allowed rights to life insurance policy proceeds if which of the following
beneficiaries is chosen? - ANS The insured's estate
How are death benefits that are received by a beneficiary normally treated for tax purposes? -
ANS Exempt from federal income taxes
Which of the following is NOT a life insurance settlement option? - ANS Extended term
option
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