Life Insurance Basics
A client needs the largest immediate death benefit the budget allows for the next fifteen years. Which is indicated?
Answer and explanation
Answer: A. Term buys the most death benefit per premium dollar because none of the premium funds a reserve, which suits a temporary need of defined length. The permanent forms cost more for the same face amount because they build value.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, permanent versus term
More life insurance basics questions
- What ordinarily distinguishes group life insurance from individual coverage?
- What primary guarantee is provided to the owner of a fixed annuity contract during the accumulation phase?
- What problem does business continuation planning address?
- What right does an applicant have in respect of a Medical Information Bureau record?
- What separates permanent life insurance from term insurance?
- What should a producer do when delivering an issued life insurance policy?
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