What are the characteristics of an adjustable life policy?
Adjustable life insurance is a hybrid of term life and whole life insurance that allows policyholders the option to adjust policy features, including the period of protection, face amount, premiums, and length of the premium payment period.
Which of these types of life insurance allows a policyowner to have level premiums and to also choose from a selection of investment options?
A life insurance policy that has a level premium but allows the policyowner to choose from a selection of investment options is known as Variable Life.
Which of the following life insurance policies allows a policyowner to take out a loan from the policy’s cash value?
Automatic Premium Loan (APL) Provision: A permanent life insurance policy non-forfeiture provision that allows an insurer to automatically pay an overdue premium for a policyowner by making a loan against the policy's cash value as long as the cash value equals or exceeds the amount of the premium due.
What can an adjustable life policy assume the form of?
Depending on the particular premium and death benefit levels chosen, the policy can assume the form of almost any traditional term or whole life policy from low-premium term through ordinary whole life to high premium, limited pay whole life.
What is adjustable Comp life insurance?
Adjustable life insurance is a form of permanent life insurance. Unlike a term policy, adjustable life insurance remains in effect for the rest of your life, as long as premiums are paid. However, policyholders are typically able to adjust their premium payments, cash value amount and even their death benefit.
Which of the following is not an option in an adjustable life policy?
All of the following statements are correct regarding adjustable life policies, EXCEPT: Cash value in an adjustable life policy only accrues when the amount of the premium paid is greater than the cost of coverage. The correct answer is: Cash value always accrues in the policy.
Which provision allows the policyowner to change a term life policy to a permanent?
The conversion provision allows the policysowner to change the policy to a permanent life policy without providing evidence of insurability.
What type of life insurance incorporates flexible premiums and an adjustable death benefit?
What type of life insurance incorporates flexible premiums and an adjustable death benefit? Universal Life is designed to provide flexible premiums and an adjustable death benefit.
Which benefit is normally payable to a life insurance policyowner when the insureds life expectancy has been severely limited?
An Accelerated Death Benefit (ADB) allows a life insurance policy owner to receive a portion of their death benefit from their insurance company in advance of their death. In most cases, the policyholder must be terminally ill, usually with a life expectancy of two years or less.
What is an adjustable death benefit?
Adjustable life insurance allows you to decrease or increase the death benefit as your coverage requirements change. If an increase is large enough, then you may be required to undergo an additional medical exam and pay higher premiums.
What does an adjustable life policy allows the policy owner to do?
Adjustable life insurance policies allow policyowner's to raise or lower the premium and face amount, and change the coverage period and premium-paying period.
How does adjustable life insurance work?
Adjustable life insurance is a form of permanent life insurance. Unlike a term policy, adjustable life insurance remains in effect for the rest of your life, as long as premiums are paid. However, policyholders are typically able to adjust their premium payments, cash value amount and even their death benefit.
What can a policyowner change a revocable beneficiary?
When can a policyowner change a revocable beneficiary? With a revocable beneficiary designation, the policyowner may change the beneficiary at any time without notifying or getting permission from the beneficiary.
What is a non participating whole life policy?
A nonparticipating whole life insurance policy does not pay dividends to the policy owner, but rather the insurer sets the level premium, death benefits and cash surrender values at the time of purchase. These amounts are fixed at policy issue.
What type of life insurance incorporates flexible premiums and an adjustable death benefit quizlet?
Universal Life. Universal life insurance is characterized by flexible premiums and an adjustable death benefit. Modified whole life policies are distinguished by premiums that are lower than typical whole life premiums during the first few years (usually five) and then higher than typical thereafter.
What is a flexible premium adjustable life insurance?
As the name implies, flexible premium, or adjustable life insurance allows the customer to choose higher or lower premiums at numerous points throughout the policy's life. These plans also come with a flexible cash value component. You can opt for higher premiums and use them to increase the policy's cash value.
How are policyowner dividends treated?
How are policyowner dividends treated in regards to income tax? Interest on accumulations is taxed. If the dividends exceed the total premium payments for the insurance policy, the excess dividends are considered taxable income.
What is a living benefit rider on life insurance?
A living benefits rider enables the policy owner to access eligible policy proceeds when facing a terminal illness. Policy owners can also access funds through a loan or surrender, but it is possible for a life insurance policy with living benefits to provide more money.
When can you increase death benefit on an adjustable life policy?
Can you change the death benefit in an adjustable life policy? Adjustable life insurance allows you to decrease or increase the death benefit as your coverage requirements change. If an increase is large enough, then you may be required to undergo an additional medical exam and pay higher premiums.
Which of the following changes may the policyowner of an adjustable life policy not make?
The correct answer is: The death benefit is the policy face amount or policy cash value, but not both. An adjustable life policy allows the policyowner to make all of the following changes, EXCEPT: Only variable life policies allow policyowner's to invest premiums in the insurer's separate account.
How does a flexible premium adjustable life policy work?
As the name implies, flexible premium, or adjustable life insurance allows the customer to choose higher or lower premiums at numerous points throughout the policy's life. These plans also come with a flexible cash value component. You can opt for higher premiums and use them to increase the policy's cash value.
What kind of arrangement gives the policyowner the right to change the beneficiary?
A revocable beneficiary is a more flexible option. It allows the policy owner to change the beneficiary on their policy without restriction.
What beneficiary may be changed by the policyowner without the consent of the beneficiary?
(An irrevocable designation may not be changed without the written consent of the beneficiary.) When can a policyowner change a revocable beneficiary? (With a revocable beneficiary designation, the policyowner may change the beneficiary at any time without notifying or getting permission from the beneficiary.)
What is the difference between a participating and non-participating life insurance policy?
Participating policies pay dividends to the policy holders i.e. the policyholders are 'participating' in the company profits which the company pays as dividends. Non-Participating policy does not provide any dividends and the policyholders does not participate in company profits.
What does non-participating provider mean?
A health care provider who doesn't have a contract with your health insurer. Also called a non-preferred provider.
What type of life insurance incorporates flexible premiums and adjustable death benefit?
What type of life insurance incorporates flexible premiums and an adjustable death benefit? Universal Life is designed to provide flexible premiums and an adjustable death benefit.
Which of these actions is taken when a policyowner uses a life?
Which of these actions is taken when a policyowner uses a Life Insurance policy as collateral for a bank loan? Collateral assignment" A policyowner using the Life Insurance policy as collateral for a bank loan normally would make a collateral assignment.
What is the difference between adjustable life and universal life?
Adjustable life insurance and universal life insurance are the same type of life insurance policy. Adjustable life insurance is the name given to older universal life insurance policies. These policies were the first universal life insurance policies designed in the 1980s.
How are policyowner dividends treated regards to income tax?
How are policyowner dividends treated in regards to income tax? Interest on accumulations is taxed. If the dividends exceed the total premium payments for the insurance policy, the excess dividends are considered taxable income.
What is a living needs rider?
The Living Needs Benefit rider is an accelerated death benefit rider that advances a portion of the policy's death benefit in the event of a terminal illness, confinement to a nursing home, or an organ transplant.