Life Insurance Basics
Why does paying premium monthly usually cost more in total than paying annually?
Answer and explanation
Answer: D. Paying more often means the insurer holds the money for less time and processes more transactions, so the total paid over a year is higher. Underwriting, taxation, and benefit levels do not vary with the mode.Source: PSI — New York DFS Insurance Candidate Information Bulletin — Outline, mode of premium
More life insurance basics questions
- During a sales presentation a producer urges a client to drop an existing policy for a new one using incomplete comparisons. What practice is that?
- During policy delivery, the owner notices a typo in the beneficiary's middle name. How should the producer assist?
- From what event does the free look period on a delivered life policy run?
- How does a business use the death benefit it receives from a key person policy?
- How does a cross-purchase buy-sell agreement use life insurance?
- How does an attending physician statement differ from a medical examination arranged by the insurer?
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