Term
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Definition
| non-cash value building type of policy that provides protection for a specified period of time only |
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Term
| Term insurance is usually purchased to satisfy: |
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Definition
| a short term need like debt |
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Term
| With term insurance, the premium usually ____________ at each renewal period. |
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Definition
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Term
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Definition
| remains the same in the amuont of insurance and premium over the stated period of time |
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Term
| What two things stay the same in a level term life policy? |
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Definition
| the face value of the policy and the premium |
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Term
| Decreasing Term Life Insurance |
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Definition
| a life insurance policy in which the face amount reduces until there is no more life insurance left |
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Term
| In a decreasing term policy, what happens to the face amount of the policy and the policy premium? |
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Definition
| The face amount of the policy decreases over the stated term; the premium stays the same for the stated term |
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Term
| Annual Renewable Term Policy |
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Definition
| A policy where the company grants the insured the right to renew the policy each year without regard to the insured's health |
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Term
| What happens to the premiums in a ART policy? |
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Definition
| the premiums go up at each renewal because they are based on the insured's attained age |
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Term
| In an ART policy, what happens to the face amount and the premium? |
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Definition
| The face amount stays the same throughout, while the premium gradually increases as the insured ages |
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Term
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Definition
| a policy feature that allows an insured to continue insurance after the policy period has ended without undergoing a physical or medical examination--premiums will still increase |
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Term
| In a renewable term policy, what happens to the face amount and premiums? |
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Definition
| the face amount of the policy stays the same, while the premium increases at each renewal period; however, the premium is the same for the whole stated period of time until the next renewal occurs |
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Term
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Definition
| A policy feature that allows the insured to switch from term insurance to permanent insurance without answering any medical questions |
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Term
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Definition
| a permanent, cash value building life insurance policy |
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Term
| At what age does whole life stop paying? |
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Definition
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Term
| What is the formula for a whole life policy? |
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Definition
| Face Value= Insurance + Cash value |
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Term
| What part of a whole life policy remains the same? |
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Definition
| the face amount (death benefit) |
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Term
| Limited Payment Whole Life Policy |
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Definition
| a type of policy in which a person pays premiums for a select period of time or until a certain age. |
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Term
| In a Limited pay whole life policy, the shorter the payment period, the ___________ the premium |
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Definition
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Term
| A limited pay policy can be paid: |
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Definition
| for a stated amount of years or until a stated age |
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Term
| the cash value of a limited pay policy will always grow ___________ than with a continuous paying policy |
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Definition
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Term
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Definition
| a whole life policy designed to endow well before the age of 100 |
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Term
| endowment policies place more emphasis on ____________ than death proceeds |
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Definition
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Term
| Modified Endowment Contract |
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Definition
| created when the premiums paid into a policy are greater than what's required to pay up a policy in 7 years |
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Term
| In a modified endowment contract, cash value drawn out before age _____ is taxable. |
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Definition
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Term
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Definition
| a policy in which one lump sum provides insurance until age 100 |
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Term
| All single premium whole life policies are _______________________________ |
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Definition
| Modified Endowment Contracts |
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Term
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Definition
| means that the premium remains level--never increasing or decreasing--throughout the contract's entirety |
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Term
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Definition
| allows an insured to pay a slightly lower level premium at the beginning of the policy and later pay an increased level premium (a young couple) |
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Term
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Definition
| a premium type in which the premium increases each year for several years and then levels out for the duration of the policy. |
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Term
| A multiple protection life policy features: |
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Definition
| a whole life policy with a term rider |
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Term
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Definition
| Policy in which the main breadwinner is covered with a whole life policy and the remaining members of the family are covered by individual term insurance policies |
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Term
| In a family plan, newborns are: |
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Definition
| automatically added on with no increase of premium |
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Term
| In a family policy, dependents (children) may convert their policies with: |
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Definition
| no evidence of insurability |
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Term
| Family Income Policy features: |
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Definition
| a whole life insurance with a decreasing term rider |
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Term
| In a family income policy, the decreasing term rider begins on the: |
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Definition
| day the policy was issued |
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Term
| If the breadwinner lives beyond the decreasing term rider.... |
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Definition
| ...then only the whole life policy would pay off |
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Term
| Family maintenance policy features: |
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Definition
| a whole life policy with a level term rider |
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Term
| In a family maintenance policy, the level term rider goes into effect at: |
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Definition
| the date of the insured's death |
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Term
| face amount plue cash value |
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Definition
| policy with an increasing term rider that pays the guaranteed cash value plus face amount at death |
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Term
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Definition
| a policy covering two or more people; the face amount is paid upon the first to die |
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Term
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Definition
| covers two or more people, but the face amount is only paid after the last person dies |
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Term
| Which policy covering more than one person is an estate-planning tool? |
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Definition
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Term
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Definition
| a policy which will only pay a death benefit for certain events such as an accident or cancer |
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Term
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Definition
A policy that's flexible in premium
- insured pays the current cost of insurance for their age and any excess premiums are invested with interest
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Term
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Definition
| an attribute of a universal life policy wherein the insured gets a statement that shows what happened to their policy for the past year |
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Term
| Universal Option A (1) Death benefit equation |
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Definition
| Face Amount= Insurance + Cash Value |
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Term
| Option A is the best for: |
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Definition
| Accumulating cash value at the lowest premium; the cash value is included in the face amount |
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Term
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Definition
| Death Benefit= Face amount + cash value |
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Term
| Option B in a UL policy is best for |
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Definition
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Term
| If a UL exceeds the corridor of insurance, it becomes a |
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Definition
| Modified Endowment Policy |
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Term
| Amounts of Insurance for a buck: |
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Definition
1. Term
2.Universal Life
3. Whole Life
4. Limited Pay Whole Life
5. Endowment
6. Single Premium Whole Life |
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Term
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Definition
| A contract issued by an insurance company that allows you to manage your money by paying in to an account for a specified period and then collecting off of it |
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Term
| The amount of income an annuitant may receive is based on: |
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Definition
| Gender, Age, Assumed Interest Rate, Loads, Income Payment Period |
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Term
| A single premium annuity: |
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Definition
| an annuity bought with a single premium |
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Term
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Definition
| the same premium payment is made until the distribution begins |
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Term
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Definition
| pays a set interest rate for a given period of time |
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Term
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Definition
| not a guaranteed contract; annuitant invests in a managed investment portfolio |
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Term
| To sell a variable annuity, you must have a license with |
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Definition
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Term
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Definition
| gurantees principal but allows for the increasing values of the equities market |
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Term
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Definition
| The payout period begins one year or less from the time the insurer receives the money from the annuitant |
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Term
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Definition
| the payout from the insurer begins more than one year from the time the insurer receives the money from the annuitant |
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Term
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Definition
| means that only one person will receive the benefits of an annuity |
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Term
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Definition
| two or more people are named to receive the annuity payment; the income continues as long as one of the two annuitants remains alive |
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Term
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Definition
| the anuitant receives payment until he or she dies, and the remaining survivor receives half of the income payment |
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Term
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Definition
| the annuitant receives the payment; when he or she dies, the survivor receives the same amount |
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Term
| Once an annuity distribution option has been selected, it is ____________ |
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Definition
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Term
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Definition
| expenses charged against an annuity for a premature distribution of funds |
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Term
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Definition
| where an annuitant receives income for their entire life, but there is no survivor |
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Term
| Annuity with period certain |
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Definition
| annuitant is guaranteed to receive an income for a certain period of time --there is a beneficiary with this option. |
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Term
| Period Certain with a life income option |
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Definition
| annuitant is guaranteed income for life and the survivor is guaranteed income for the period certain; if annuitant outlives period certain, survivor gets nothing |
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Term
| which annuity provides a person with the highest monthly income? |
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Definition
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Term
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Definition
| states that after TWO years from policy issue date, a company cannot make a policy void unless it can be proven that the applicant lied |
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Term
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Definition
| 31 day period in which the policyowner must pay a late premium |
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Term
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Definition
| minimum 10 days; starts on the policy delivery date; |
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Term
| non-forfeiture options and meanings |
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Definition
Cash Surrender: surrenders policy for cash value; least amount of insurance and most amount of cash value
Reduced Paid Up: CV buys paid up WL policy; insurance for longest amt of time
Extended Term: highest amt of insurance; won't last as long as RPU because it's term |
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Term
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Definition
| owner of a participating policy shares in the profits of the insurer |
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Term
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Definition
Cash: sends you a check for the earned dividends
Reduce Premiums: insurer reduces the annual premiums by amout of dividend
Accumulate at Interest: keep dividend in acct and pay a better interest rate on it--TAXABLE.
Paid Up Additions: buy additional life insurance without having to answer ?s.
One year Term: additional amount of insurance equal to CV of policy
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Term
| fixed amount settlement option |
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Definition
| allows a fixed amount to be paid to the beneficiary until none is left |
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Term
| fixed period settlement option |
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Definition
| designed to pay income for a fixed period of time. |
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Term
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Definition
| the policyowner attaches this to a policy when he or she has a specific way he wants the inheritance to be settled |
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Term
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Definition
| primary, contingent, estate |
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Term
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Definition
| states that a beneficiary must outlive an insured by a certain number of days in order to be eligible to receive the inheritance |
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Term
| Uniform Simultaneous Death Act |
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Definition
| states that it will be assumed that the primary beneficiary predeceased the insured |
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Term
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Definition
| policy where the expenses are taken out at the beginning |
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Term
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Definition
| builds cash value more quickly because the expenses are taken out toward the end of the policy's life |
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Term
| in order for the death and dismemberment clause to kick in, the insured must die from the related injury within _____ days |
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Definition
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Term
| premiums paid by an employer for group life insurance are not ___________ to the employee as long as the face amount does not _____________ |
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Definition
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Term
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Definition
| meant to pay off a mortgage balance should the debtor die |
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Term
| in a group life policy, the entire group must be _____________ or ___________ |
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Definition
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Term
| penalty-free distributions from an IRA must be in the window of |
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Definition
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Term
| a roth IRA is unique in that |
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Definition
| there is no tax paid on any amount withdrawn |
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Term
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Definition
| available only to employees of tax-exempt charities or religious organizations and those who work for public school systems |
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Term
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Definition
| for self-employed persons; allow them to make tax-deductible contributions and receive the same tax deduction as corporatinos |
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Term
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Definition
| self employed; 21 years old; |
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Term
| Cross purchase buy sell agreement |
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Definition
| each owner buys life insurance on the other owners so that they can use the cash to buy out that person's share of the business |
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Term
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Definition
| teh business buys a life insurance policy on each owner and is the beneficiary; the last remaining owner would own everything |
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Term
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Definition
| states that a person is insured based on home office approval |
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Term
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Definition
| DB= FA + Value of separate account |
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Term
| the insurance company has ___ days to tell someone they've been denied insurance |
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Definition
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Term
| how many days notice must be given for group life policies due to nonpay? |
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Definition
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Term
| group life policy must cover ____ wmployees at issue date |
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Definition
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Term
| replacement policies have a minimum free look period of ___ days |
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Definition
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Term
| a policy summary is not required if: |
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Definition
| the policy has a death benefit of 5,000 or less |
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Term
| the life replacement regulation applies to __________________ policies |
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Definition
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