Management Notes

Reference Notes for Management

Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?

Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?

Y purchased $100,000 worth of permanent protection on himself and $50,000 worth of 10-year Term coverage for his wife on the same policy. Which of these policies did Y purchase?

 Options:

  1. Endowment with Extended Term
  2. Endowment with a Payor Benefit
  3. Whole Life policy with an Other Insured Rider
  4. Family Income Policy

The Correct Answer Is:

  • B) Whole Life policy with an Other Insured Rider

Read more

Level premium permanent insurance accumulates a reserve that will eventually

Level premium permanent insurance accumulates a reserve that will eventually

Level premium permanent insurance accumulates a reserve that will eventually

A) equal the face amount of the policy
B) pay a dividend to the policyowner
C) require the policyowner to make periodic withdrawals
D) become larger than the face amount

Correct Answer: A) equal the face amount of the policy

Level premium permanent insurance accumulates a reserve that will eventually

Read more

Which statement is not true regarding a straight life policy

Which statement is not true regarding a straight life policy

Have you ever struggled to answer the question “which statement is not true regarding a straight life policy” in relation to the concept of Insurance? There’s no need to worry about it anymore. This post contains the correct answer to your question.

Which statement is not true regarding a straight life policy

Options:

  • A) It has the lowest annual premium of the three types of Whole Life policies.
  • B) Its premium steadily decreases over time, in response to its growing cash value.
  • C) The face value of the policy is paid to the insured at age 100.
  • D) It usually develops cash value by the end of the third policy year

The Correct Answer Is:

  • B) Its premium steadily decreases over time, in response to its growing cash value.

Read more

Which of the following best describes term life insurance

Which of the following best describes term life insurance

Have you ever struggled to answer the question “which of the following best describes term life insurance” in relation to the concept of Insurance? There’s no need to worry about it anymore. This post contains the correct answer to your question.

Which of the following best describes term life insurance

Options:

a. The insured can borrow or collect the cash value of the policy.
b. The insured pays a premium for a specified number of years.
c. The insured pays the premium until his or her death.
d. The insured is covered during his or her entire lifetime

Read more

What is being delivered during a policy delivery ?

What is being delivered during a policy delivery ?

What is being delivered during a policy delivery

Options:

  • A. A binding receipt to the proposed insured
  • B. Insurance contract to the proposed insured
  • C. Application and initial premium to the insurer
  • D. Policy summary sheet and disclosure material to the proposed insured

The Correct Answer Is:

  • B. Insurance contract to the proposed insured

Read more

Which of the following is correct regarding credit life insurance

Which of the following is correct regarding credit life insurance

Which of the following is correct regarding credit life insurance

Options:

A) It insures the life of a creditor.
B) It has a maximum term of 20 years.
C) It insures the life of a debtor.
D) It is purchased on an installment basis.

The Correct Answer Is:

  • C) It insures the life of a debtor.

Which of the following is correct regarding credit life insurance

Read more

A level premium indicates

A level premium indicates

A level premium indicates

Options:

  • A) the premium is fixed for a period stated in the contract, then becomes variable
  • B) the premium can only be changed with the consent of the insurer
  • C) the premium stays level until the policy’s renewal date
  • D) the premium is fixed for the entire duration of the contract

The Correct Answer Is:

  • D) the premium is fixed for the entire duration of the contract

Read more

What does liquidity refer to in a life insurance policy

What does liquidity refer to in a life insurance policy

Have you ever struggled to answer the question “what does liquidity refer to in a life insurance policy” in relation to the concept of Insurance? There’s no need to worry about it anymore. This post contains the correct answer to your question.

What does liquidity refer to in a life insurance policy

Options:

  • A) The policyowner receives dividend checks each year
  • B) The insured is receiving payments each month is retirement
  • C) Cash values can be borrowed at any time
  • D) The death benefit replaces the assets that would have accumulated if the insured not died

The Correct Answer Is:

  • C) Cash values can be borrowed at any time

Read more

Which of the following is true regarding the annuity period

Which of the following is true regarding the annuity period

Which of the following is true regarding the annuity period

Options:

  • A. It may last for the lifetime of the annuitant.
  • B. During this period of time the annuity payments grow interest tax deferred.
  • C. It is also referred to as the accumulation period.
  • D. It is the period of time during which the annuitant makes premium payments into the annuity.

The Correct Answer Is:

  • A. It may last for the lifetime of the annuitant.

Read more

Which type of life insurance policy generates immediate cash value

Which type of life insurance policy generates immediate cash value

Have you ever struggled to answer the question “which type of life insurance policy generates immediate cash value” in relation to the concept of Insurance? There’s no need to worry about it anymore. This post contains the correct answer to your question.

Which type of life insurance policy generates immediate cash value

Options:

  • A. Single premium
  • B. Level Term
  • C. Decreasing Term
  • D. Continuous Premium

The Correct Answer Is:

  • A. Single premium

Read more

Who might receive dividends from a mutual insurer

Who might receive dividends from a mutual insurer

Have you ever struggled to answer the question “who might receive dividends from a mutual insurer” in relation to the concept of Insurance? There’s no need to worry about it anymore. This post contains the correct answer to your question.

Who might receive dividends from a mutual insurer

Options:

a) Policyholders
b) Subscribers
c) Stockholders
d) Agents

The Correct Answer Is:

  • a) Policyholders

Read more