cic life/health: life insurance Questions With Complete Solutions.

General uses of life insurance - create an estate;pay estate taxes;fund business transfer,pay mortgage,provide educ fund; legal elements of of life contract - agreement:offer/accept, consideration: pmt of prem, competent parties: legal capacity, legal purpose: insurable interest at beginning 3 type of term insurance -1) level: same premium over specified time 2)annual renewable term: face amt stays same as prem incr 3)decreasing term: face amount decr while prem is level What is whole life/purposes? - 1)policy pays face amt on death 2) permanent protection, college, estate protection benefits/features of whole life - premium constant in case of lapse-policy stays in force via automatic payment of premium non forfeiture- select cash,reduced paid up, or extended term definition of universal life - flexible prem/adjustable benefit can function via term/whole life universal life option - option a) includes cash value w/in death benefit opt b) pays cash value in addition to death benefit 6 components of universal life insurance - 1)cash 2)mortality charge 3)cash value ( policy expenses/interest)6)death benefit universal life flexible choices - skip premiums, self supporting, inc/decre face amt, universal vs whole - whole: face amt fixed, fixed prem, guarantee cash value, cv not paid in addition to death benefit universal: face amt varies, flex prem, min guarantee rate of interest plus rate tied to market, opt a/b conditional receipt - 1) issued by agent after completed contract/receive money 2)coverage is in force as of app date 3)non standard wording (so know the carrier)