quiz5(01)

. Based on the CSO & Life Expectancy Tables in the \"Classes\" folder of

. . . . . . . . . .

Compass, what is the difference in life expectancy of a 20 year old male and 27 year old female?Answer . 5.05 . 5.24 . 6.49 . 11.03 . None of the

above

1 points

.

Question 2

. Daisy pays $1,533 in premium per year on her straight whole life

. . . . . . . . . .

policy. She decides to surrender the policy on August 1 in the 15th year of the policy for $29,486. What is Daisy's tax liability if she is in the 28% income tax bracket and has received $2,000 in dividends?Answer . $ 560 . $ 1,257 . $ 2,377 . $ 14,134 . None of the

above

1 points

.

Question 3

. Davis dies leaving his wife a $500,000 life insurance policy death

. . . . . . . . . . .

benefit. The wife elects to take the $500,000 as a ten-year period certain annuity and receives $55,130 per year. Which part of the payment is taxable income to Davis' wife?Answer . none of it . only the $500,000 death benefit . $ 55,130 per year . $ 5,130 per year . none of the above

1 points

Question 4

. Mark purchased a universal life insurance policy at the age of 35. He

is now 43 years old and at the end of the eighth year of the policy. The policy was sold with a face amount is $100,000 and death

. . . . . . . . . .

benefit option 1 and a planned premium of $1,500 per year which Mark has paid. At the beginning of year 8, the cash value of the policy was $7,800 and it grew by $1,000 during the year. The policy was credited with a $1,100 dividend. If Mark purchased an annual renewable term policy now, it would cost him $400 for $100,000 of coverage. Based on Yearly Rate of Return, what is the return on Mark's policy during the eighth year?Answer . $ 100 . 2.9 % . 7.1 % . 10.4 % . None of the

above

1 points

.

Question 5

. John & Jane Doe (husband & wife) each have a life insurance policy

. . . . . . . . . . . . .

that names the other as a direct beneficiary. John has his sone Jack as the contingent beneficiary and Jane has her daughter Jill as

beneficiay. John and Jane are involved in car accident. John is dead when the paramedics arrive and Jane dies before leaving the scene of the accident. The death benefit from both policies are paid to:Answer . John's estate . Jane's estate . Each estate in equal parts . Jack and Jill . The insurance company cannot pay the death benefit . None of the above

1 points

Question 6

. Which of the following policies would have the lowest first year premium for a 20-year-old male?Answer . . . 10-year level term . . . Straight Whole Life . . . Whole life paid up at

65

. . . Universal life . . . Annual renewable

term

.

1 points

Question 7

. If an individual wanted to purchase a life insurance policy that

. . . . . . . .

. .

provided both death protection and a tax-sheltered investment, which type(s) of life insurance would best suit his or her

needs?IVariable universal lifeIIUniversallifeIIIRe-entry termIV10-year level term VStraight whole lifeAnswer . I and II . II and V . III and IV . I, II, and

V

. III, IV,

and V

1 points

.

Question 8

. All of the following are factors used in computing life insurance rates

except:Answer . . . a rate of interest. . . . morbidity. . . . mortality. . . . expenses of the

insurer.

. . . none of the above. .

1 points

Question 9

. . . . . . . A mortality table shows:. . . . . . . . . .

Answer

average death benefits.

probabilities of dying at different ages.

interest rates per $1,000 of insurance coverage. probabilities of a waiver of premium claim occurring. none of the above.

1 points

Question 10

. The family policy which is designed to provide coverage on all

members of the family in a single contract usually providesAnswer . . . term coverage on all members of the family. . . . the same amount of coverage on all members of the family. . . . whole life on the wage earner, with smaller amounts of term o

. . . . .

. whole life on all members of the family. . none of the above.

1 points

Question 11

. Group insurance is a less expensive form of protection than individual

policies becauseAnswer . . . commissions to agents are lower. . . . the employer performs certain administrative functions. . . . mortality experience has been better under group policies. . . . medical examinations are eliminated. . . . all of the above. .

1 points

Question 12

. . . . . . . Annuities are classified in all of the following ways except:Answer . . by the date of the first annuity payment. . . by the method of premium payment. . . by the duration of the annuity income. . . by the value remaining at the death of the annuitant. . . by the face amount of the policy.

1 points

Question 13

. David is worried that he will die before his wife, Anna, and wants to

. . . . .

. . . . .

purchase an annuity that will pay an annual income the rest of

Anna's life. What type of annuity should David purchase?Answer . Life annuity with 10-years certain . Joint-and-survivor annuity . Universal Life . Joint annuity . Temporary annuity