1. "A". Annual renewable term is the only term coverage offered in group life insurance policies. Universal life and straight whole life are acceptable forms of permanent coverage for such policies.
  2. "D". Flat benefit or a percentage multiple of one's salary are correct types of formulas.
  3. "C". Plans are tax advantaged so long as they are not discriminatory.
  4. "C". Underwriting is simplified in group life insurance.
  5. "C". Contributory is the correct term.
  6. "A". Annual renewable term is the underlying type of coverage. The question asks about the different types of arrangements, rather than the underlying coverage.
  7. "B". Experience rating based upon the group's prior years' claims experience is how group life insurance is underwritten. Rat-up in age is a form of underwriting for substandard risks; traditional net cost method is a means of policy comparison and standard risk refers to the type of risk that an underwriter might consider in pricing a policy.


Review Questions

Related Articles
  1. Financial Advisor

    Group Term Life Insurance: What You Need to Know

    Is group term life insurance really a good deal? What you need to know about employer-sponsored group term life insurance coverage.
  2. Insurance

    4 Reasons Why Waiting To Buy Life Insurance Is a Bad Idea

    Understand the benefits of applying for and securing life insurance coverage while you are young and healthy, and learn the cost of waiting to get coverage.
  3. Insurance

    Which Kind of Life Insurance Is Best for You?

    Parse the pros and cons of different policy types to ensure the best coverage for your needs.
  4. Financial Advisor

    7 Issues to Consider When Determining Life Insurance Coverage

    Seven issues to consider when buying life insurance to ensure the coverage is tailored to meet your personal financial situation.
  5. Insurance

    Term Life Insurance: Everything You Need to Know

    Term life insurance is an affordable way to financially protect your loved ones after your death. Here's what you need to know before purchasing a policy.
  6. Retirement

    Understanding Different Types of Life Insurance

    Understand the various types of life insurance, how each can be used in personal or business financial planning, and for whom they are best-suited.
  7. Financial Advisor

    Advising FAs: Explaining Life Insurance to a Client

    Life insurance was initially designed to protect the income of families, particularly young families in the wealth accumulation phase, in the event of the head of household's death.
  8. Insurance

    5 Life Insurance Questions You Should Ask

    Confused about $1 million dollar insurance advertising claims? Decide whether they'll pay off for you.
  9. Financial Advisor

    Why to Buy Term Life Insurance with a Conversion Option

    Why you should always purchase a term life insurance policy that allows for an unrestricted conversion option.
  10. Financial Advisor

    Is Life Insurance From Your Employer Enough?

    Covering the needs of the ones you would leave behind is not easy. But efforts to secure a life insurance policy outside of work should pay off.
Trading Center