What happens when a universal life policyholder pays the minimum premium?

What happens when a universal life policyholder pays the minimum premium?



a. The face amount will automatically increase.

b. The face amount will automatically decrease.

c. The policy will resemble term life insurance.

d. The policy will resemble whole life insurance.



Answer: c. The policy will resemble term life insurance.

Comments

Post a Comment

Popular posts from this blog

Give the von Neumann-Morgenstern utility function.

  Give the von Neumann-Morgenstern utility function. A utility function has expected utility propety if u(g)=∑p_{i}u(a_{i}) for any g∈G where (p₁°a₁,...,p_{n}°a_{n}) is the simple gamble induced by g. The von Neumann-Morgenstern utility function is typically denoted as � ( � ) U ( x ) , where � x represents an outcome or a set of outcomes. This utility function satisfies the expected utility property, which states that for any gamble � g with associated probabilities � � p i ​ and outcomes � � a i ​ , the utility of the gamble � ( � ) u ( g ) is equal to the sum of the probabilities weighted by the utility of each outcome: � ( � ) = ∑ � � � ⋅ � ( � � ) u ( g ) = ∑ i ​ p i ​ ⋅ u ( a i ​ ) Here: � ( � ) u ( g ) represents the utility of the gamble � g . � � p i ​ is the probability associated with the outcome � � a i ​ . � ( � � ) u ( a i ​ ) is the utility of the outcome � � a i ​ . The sum is taken over all possible outcomes of the gamble. This property essentially captures ...
Read more

Life income joint and survivor settlement option guarantees

Life income joint and survivor settlement option guarantees a) Income for 2 or more recipients until they die. b) Payment of interest on death proceeds. c) Payout of the entire death benefit. d) Equal payments to all recipients. Answer: a) Income for 2 or more recipients until they die.
Read more

All of these statements about the Waiver of Premium provision are correct EXCEPT

All of these statements about the Waiver of Premium provision are correct EXCEPT A. A waiting period must pass before becoming eligible for benefits B. Waiver of Premium is available on both permanent and term insurance policies C. Insured must be eligible for Social Security disability for claim to be accepted D. Insured must be totally disabled to qualify Answer: C. Insured must be eligible for Social Security disability for claim to be accepted
Read more