California Life-Only & Accident and Health AgentLife InsuranceEasy
A 35-year-old client is evaluating different life insurance policies and is particularly interested in one that offers a guaranteed death benefit, guaranteed cash value growth, and level premiums for the life of the policy. Which type of policy best fits these requirements?
- AUniversal Life Insurance
- BVariable Life Insurance
- CTerm Life Insurance
- DWhole Life Insurance
Show answer & explanationAnswer & explanation
Correct answer: D. Whole Life Insurance
Whole Life Insurance provides a guaranteed death benefit, cash value that grows on a guaranteed schedule, and level premiums for the entire life of the insured, aligning with the client's requirements.
Why the other options are wrong
- A. Universal life insurance has flexible premiums and adjustable death benefits, but cash value growth may not be guaranteed.
- B. Variable life insurance has no guaranteed cash value growth or death benefit.
- C. Term life insurance has no cash value and only covers a specific period.
Whole Life Insurance
A type of permanent life insurance that provides coverage for the entire life of the insured, featuring a guaranteed death benefit, guaranteed cash value growth, and level premiums.
- Coverage for entire life
- Guaranteed death benefit
- Guaranteed cash value growth
- Level premiums
Memory trick: Whole life is a 'whole' package: permanent, guaranteed, and steady.