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3 Cards in this Set
- Front
- Back
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A registered representative's (RR) customer is speaking of a variable life insurance contract he owns. He makes several statements regarding the contract. Which of the following is NOT an accurate statement concerning a variable life insurance contract?
A) The death benefit cannot ever be more than the guaranteed benefit. B) The portion of the premium invested in the insurance company's general account is used to provide for the minimum guaranteed amount of the death benefit. C) There is no guarantee regarding the investment results of the separate account. D) The policy provides a minimum guaranteed death benefit. |
Answer: A
The minimum guaranteed death benefit is provided by that portion of the payment invested in the insurance company's general account. The remainder of the premium is invested in the separate account. While there is no guarantee on how investments in the separate account will perform, depending on its investment performance, the separate account could provide for a larger death benefit than the minimum guaranteed amount. |
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A rider or statement of condition that allows a variable life insured to maintain policy coverage after becoming disabled is a benefit known as:
A) Waiver of premium B) Life income C) Annuity phase D) Minimum guaranteed death benefit |
Answer: A
Waiver of premium is a benefit available on qualified life insurance contracts, usually in the form of a rider, which provides for the waiver of premium payments that fall due while the policyholder is totally disabled. |
