Life Insurance Basics
What separates permanent life insurance from term insurance?
Answer and explanation
Answer: B. Permanent insurance is designed to remain in force for life and accumulates cash value, while term provides protection for a stated period at a lower initial cost and ordinarily builds no value. Renewal and conversion features are common in term, and both are underwritten.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, permanent versus term
More life insurance basics questions
- What do the two principal parts of a life insurance application contain?
- What does a policyowner receive under a participating policy that a nonparticipating policy does not provide?
- What does liquidity mean in the context of a permanent life policy?
- What does the human life value approach measure?
- What gives a permanent policy its cash accumulation feature?
- What is a participating life insurance policy?
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