Types of Policies
An insured develops a health condition halfway through a 20-year level term policy. What happens to the fixed death benefit and premium specified for that term?
Answer and explanation
Answer: B. Level term provides a fixed death benefit and premium amount throughout the term, and those amounts do not change merely because health changes. The condition does not convert the term policy into cash-value or variable insurance.Source: NAIC — Life Insurance — Term Life Insurance > Level term insurance
More types of policies questions
- A buyer wants permanent life insurance and wants the scheduled premium obligation to end at age 65 while coverage can continue for life. Which policy design fits?
- A buyer wants to fund a deferred annuity through a series of purchase payments rather than one lump sum. Which funding pattern should the buyer select?
- A buyer wants to fund a deferred annuity with one lump-sum purchase payment and make no later premiums. Which funding form fits?
- A client asks why return-of-premium term costs more than ordinary level term for the same face amount and period. What is the correct explanation?
- A client rejects separate-account market risk and also does not want required premiums later recalculated under a current-assumption design. The client wants whole life with required fixed premiums, but with extra credited interest, when available, improving values or helping future premiums. Which design best fits?
- A client wants flexible premiums and an adjustable death benefit, but also wants to place policy value in equity and bond portfolios and accepts that those values can rise or fall with market performance. Which explanation best distinguishes the product from non-variable universal life?
590 Texas questions like this one.
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