Florida 2-15 Life, Health and Variable Annuity AgentGeneral Knowledge of Life InsuranceEasy
A 40-year-old client is looking for a life insurance policy that offers a guaranteed level premium, guaranteed cash value accumulation, and a guaranteed death benefit that will remain in force for their entire life. Which type of policy best fits these needs?
- AUniversal Life Insurance
- BTerm Life Insurance
- CVariable Universal Life Insurance
- DWhole Life Insurance
Show answer & explanationAnswer & explanation
Correct answer: D. Whole Life Insurance
Whole life insurance is characterized by guaranteed level premiums, guaranteed cash value growth, and a guaranteed death benefit that lasts for the insured's entire life, aligning perfectly with the client's stated needs.
Why the other options are wrong
- A. Universal life has flexible premiums and death benefits, and non-guaranteed cash value growth.
- B. Term life has a death benefit for a specific period and no cash value.
- C. Variable universal life has flexible premiums and death benefits, but cash values fluctuate with investment performance and are not guaranteed.
Whole Life Insurance
A type of permanent life insurance that provides a guaranteed death benefit for the insured's entire life, along with guaranteed level premiums and guaranteed cash value accumulation.
- Guaranteed death benefit for life.
- Guaranteed level premiums.
- Guaranteed cash value growth.
Memory trick: Whole Life: ALL Guaranteed, ALL the time.