Retirement and Other Insurance Concepts
What distinguishes a contributory group life plan from a noncontributory plan?
Answer and explanation
Answer: A. A contributory plan is one in which covered employees pay part of the premium, while in a noncontributory plan the employer pays it all. Dependant coverage, the insurer's domicile, and the type of coverage are separate questions.Source: Pearson VUE — Georgia Insurance Examination Content Outlines #121102 — Outline page S2, Contributory and noncontributory
More retirement and other insurance concepts questions
- A planner totals a family's final expenses, mortgage balance, and income needs, then subtracts savings and Social Security benefits. Which method is being used?
- A policy fails the seven-pay test and becomes a modified endowment contract. How are its living distributions taxed?
- A wife applies for and owns a policy on her husband's life, naming their child as beneficiary. What is this arrangement called?
- After a life settlement closes, who owns the policy and who is responsible for the premiums?
- Are individual life insurance premium payments tax-deductible for personal income tax purposes?
- Four equal partners fund a cross-purchase buy-sell agreement with individual life policies. How many policies are required?
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