Types of Policies
What happens to the cost of an increasing term benefit as the insured ages and the coverage amount rises?
Answer and explanation
Answer: D. As both attained age and face amount increase, the mortality charge for increasing term rises.Source: NAIC Term Life Guide — PDF page 4, Increasing Term Costs
More types of policies questions
- A variable universal life policy keeps the same stated premium plan and mortality charge schedule, but the owner's selected stock subaccount falls sharply. Which policy element is directly changed first by that investment performance and can later affect whether charges can be paid?
- A variable whole life owner reallocates policy value among available stock and bond choices. Which account description should the producer use?
- A worker buys an annuity at age 45 and plans to begin income at age 65 after years of tax-deferred accumulation. Which classification best fits?
- An annual renewable term policy keeps the same death benefit for each one-year term. What normally happens to its premium from year to year?
- An annually renewable term policy is renewed for another year. What happens to the premium and to the evidence of insurability?
- An annuitant wants lifetime income but also wants payments guaranteed for at least 15 years if death occurs early. Which payout basis addresses both goals?
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