who bears all of the investment risk in a fixed annuity?
answer
The insurance company
question
a straight life policy has what type of premium?
answer
A level annual premium for the life of the insured
question
When would a 20-pay whole life policy endow?
answer
When the insured reaches age 100
question
An individual has been making periodic premium payments on an annuty. The annuity income payments are scheduled to begin 2 years after the annuity was purchased. What type of annuity is it?
answer
Defeered
question
With respect to a Variable annuity, when is the number of annuity units determined?
answer
At the time of the initial payout
question
Why is an equity indexed annuity considered to be a fixed annuity?
answer
It has a guaranteed minimum interest rate.
question
In a survivor-ship life policy, when does the insurer pay the death benefit?
answer
Upon the last death
question
The term "fixed" in a fixed annuity refers to all of the following but
answer
Death benefit
question
Which of the following products requires a securities license?
answer
Variable annuity
question
At the time of annunciation of a variable annuity, which of the following CANNOT fluctuate?
answer
The number of annuity units
question
Which of the following types of policies allows the policy owner to skip premium payments, provided that there is enough cash value in the policy to cover the premium amount?
answer
Universal life
question
An insured has a life insurance policy that requires him to only pay premiums for a specified number of years until the policy is paid up. What kind of policy is it?
answer
Limited-pay life
question
Annually renewable term policies provide a level death benefit for a premium that
answer
Increases annually
question
all other factors being equal, the least expensive first-year premium payment is found in
answer
Annually renewable term
question
The main difference between immediate and deferred annuities is
answer
When the income payments begin.
question
which of the following is true regarding variable annuities
answer
The annuitant assumes the risks on investment.
question
a party wishing to buy an annuity that will advance with economic and market conditions should buy a
answer
variable annuity
question
which of the following is a feature of a variable annuity?
answer
benefit payment amounts are not guaranteed.
question
The equity in an equity index annuity is linked to
answer
an index like standard and poor's 500
question
an insured purchased a life insurance policy. The agent told him that depending upon the company's investments and expense factors, the cash values could change from those shown in the policy at issue time. The policy is an
answer
Interest-sensitive whole life.
question
Under which of the following annuities is the exact monthly benefit not know in advance?
answer
variable annuity
question
which of the following is not true regarding equity indexed annuities?
answer
They earn lower interest rates than fixed annuities.
question
which of the following is true for both equity indexed annuities and fixed annuities?
answer
They have a guaranteed minimum interest rate.
question
Under a 20-pay whole life policy, in order for the policy to pay the death benefit to a beneficiary, the premiums must be paid
answer
for 20 years or until death, whichever occurs first.
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