Basics of Life Insurance

What is one key difference between life insurance and other types of insurance like auto or property insurance?

• Life insurance is only for people over 50.

• Life insurance is for the insured person, not the beneficiaries.

• Life insurance is guaranteed to be used at some point.

• Life insurance is cheaper than other types of insurance.

Who are the typical beneficiaries of a life insurance policy?

• The government

• Family members or loved ones

• The insurance company

• The insured person

Why might teenagers generally not need life insurance?

• They have no dependents.

• They have large debts.

• They have high medical expenses.

• They are not allowed to purchase insurance.

What is the 7/70 Method used for?

• Determining the age to buy life insurance

• Estimating the amount of life insurance needed

• Calculating the premium for auto insurance

• Calculating the cost of a funeral

What is a characteristic of term life insurance?

• It guarantees death benefits payout.

• It has a cash value.

• It covers the policyholder's entire lifetime.

• It has low premiums that can increase on renewal.

What is a benefit of permanent life insurance?

• It has no cash value.

• It offers low premiums.

• It only covers a short term.

• It guarantees death benefits payout.

What factor might affect the premium rates for life insurance?

• The policyholder's shoe size

• The policyholder's health status

• The policyholder's favorite color

• The policyholder's favorite food

What should a person consider before purchasing life insurance?

• The color of the insurance policy

• The brand of the insurance company

• The opportunity costs of insurance

• The number of pages in the policy document