Types of Policies
A prospect wants permanent life insurance, wants to choose among stock and bond investment options, and accepts possible cash-value loss. Which product best fits?
Answer and explanation
Answer: A. Variable life is permanent insurance whose cash value depends on owner-selected investment options and can lose value.Source: U.S. Securities and Exchange Commission — Variable Life Insurance — Key Risks > Risk of loss; risks associated with investment options
More types of policies questions
- What defines the death benefit and premium structure of a standard level term life policy?
- What external measure is commonly used to determine interest credits in indexed universal life?
- What feature of a Market Value Adjusted (MVA) annuity alters early surrender values based on interest rate shifts?
- What happens if a universal life policy's cash value is insufficient to cover monthly mortality and administrative deductions?
- What happens to the cash value in a decreasing term life policy as the face amount approaches zero?
- What happens to the cost of an increasing term benefit as the insured ages and the coverage amount rises?
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