Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. She would like to borrow $15,000 against the cash value. Which of the following statements is TRUE?

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Joanne has a $100,000 whole life policy with an accumulated $25,000 of cash value. She would like to borrow $15,000 against the cash value. Which of the following statements is TRUE?

a) Net death benefit will be reduced if the loan is not repaid
b) No interest will be charged on loan balance
c) Term life policies are the only type of insurance that allows policy loans
d) A loan can be taken out for up to the face amount of the policy

Answer: a) Net death benefit will be reduced if the loan is not repaid

WA Life Insurance

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An insured's building has an actual cash value of $200,000, and he has insured the property for $120,000 with an 80% coinsurance clause. A $40,000 loss occurs. How much will the policy pay?

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