Which of these statements describe a Modified Endowment Contract (MEC)?
Options:
- Falls below the minimum amount of premium that can be paid into a policy and still have it recognized as life insurance contract
- Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as life insurance contract
- The 7-pay test is used to determine the minimum death benefit of the policy
- The 7-pay test is used to determine the maximum death benefit of the policy
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The Correct Answer Is:
b. Exceeds the maximum amount of premium that can be paid into a policy and still have it recognized as life insurance contract
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