What is the purpose of a fixed period settlement option quizlet? What is the purpose of a fixed-period settlement option? To provide a guaranteed income for a certain amount of time.
What is a beneficiary of a fixed period settlement option?
A beneficiary is the person or interest to whom the policy proceeds will be paid upon the death of the insured. Beneficiaries do not have to have an insurable interest in the policyholder. What is the purpose of a fixed-period settlement option? A. To provide a guaranteed income for life
When the fixed period installments option is selected?
When the fixed-period installments option is selected, the insurer agrees to pay the proceeds in equal installments over a specified period of time. Under which of the following circumstances would an insurer pay accelerated benefits? A. An insured is looking for a way to put her daughter through college.
What does “interest only settlement” mean?
Upon the death of the insured, the primary beneficiary discovers that the insured chose the interest only settlement option. What does this mean? A. The beneficiary must pay interest to the insurer.
What is the dividend option in life insurance?
What is guaranteed insurability rider?
What is return of premium rider?
Is interest only a settlement option?
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What is the purpose of a fixed settlement option quizlet?
A fixed period option pays policy proceeds in equal installments over a period of months or years.
What is the purpose of a fixed settlement?
Fixed period The fixed period life settlement option distributes the death benefit plus any earned interest over a specific period of time. That monthly check functions as tax-free income and can help your beneficiary cover living expenses.
What is the purpose of settlement options in life insurance quizlet?
These settlement options are also known as life income settlement options. Life income settlement options share a common element: they involve income payments that the payee cannot outlive. In essence, the proceeds of the insurance policy are used to buy an immediate annuity on the payee's life.
What best describes fixed period settlement option?
Which of the following best describes the fixed-period settlement option? Under the fixed period option (also called period certain), a specified period of years is selected, and equal installments are paid to the recipient.
What is a fixed option?
A fixed price purchase option is the right, but not the obligation, to buy a leased item at the end of a lease term at a price determined from the onset of the lease agreement. A fixed price purchase option's purchase price is established when the lease terms are set.
What is a settlement option in life insurance?
Settlement Options — in life insurance, how proceeds are paid to the designated beneficiaries. Most life insurance policies provide for payment in a lump sum.
Which of the following is a settlement option quizlet?
There are four settlement options: interest only, fixed-period installments (period certain), fixed-amount installments and life income.
Which of the following is the most common settlement option for life insurance?
The following are the most common options available: - Lump Sum. The beneficiary takes the full amount of the death benefit as a single settlement.
Which of the following settlement options does not include a life contingency?
Settlement options with a life contingency base payments on which of the following? The fixed amount option does not include a life contingency.
How is the interest portion of a fixed period settlement option treated for tax purposes?
8. Fixed Period. When a Fixed Period is chosen, the death benefit is paid out over a specific period of time such as 5, 10, or 15 years. Interest will typically be added as well and that portion will be taxable.
Which of the following settlement options in life insurance is known as Straight life quizlet?
Which of the following settlement options in life insurance is known as straight life? Correct! The life-income option, also known as straight life, provides the recipient with an income that he or she cannot outlive.
What are the types of settlement options?
There are two forms of options settlement: physical and cash settlement. With a physical settlement, the trade completes with the transfer of the underlying asset from the seller to the buyer. A call option holder exercises the option on a specific stock.
Which is an example of a type of settlement option?
An annuity or a pension is type of settlement option where the insured gets regular stream of income after the completion of the maturity period when the insured reaches the vesting age.
What is a fixed period annuity?
Fixed Period Annuity — an annuity policy that makes income payments for a limited period of time (e.g., 5 years). Payments cease after the stipulated period or upon the annuitant's death.
What is the primary reason for buying an annuity?
The main reason for buying a deferred annuity is to accumulate money on a tax-deferred basis, which can then provide an income at a later date. There are two basic types of annuity contracts—fixed and variable. At the time you buy an annuity contract you will select between a fixed or variable.
What is fixed period life in an annuity?
fixed period annuities. A fixed period annuity pays an income for a specified period of time, such as ten years.
What is the dividend option in life insurance?
An insured has a life insurance policy from a participating company and receives quarterly dividends. He has instructed the company to apply the policy dividends to increase the death benefit. The dividend option that the insured has chosen is called
What is guaranteed insurability rider?
The guaranteed insurability rider may be structured to allow for specific additional amounts of insurance to be purchased at specific ages, dates and events without proving insurability; however, the coverage is purchased at the insured's attained age and the maximum allowable purchase is specified in the base policy.
What is return of premium rider?
The Return of Premium Rider is achieved by using increasing term insurance. When added to a whole life policy it provides that at death prior to a given age, not only is the original face amount payable, but also all premiums previously paid are payable to the beneficiary. Click again to see term 👆.
Is interest only a settlement option?
Interest only is a settlement option. ... All of the following are true regarding insurance policy loans EXCEPT. AThe policy will terminate if the loan plus interest equals or exceeds the cash value of the policy. BPolicyowners can borrow up to the full amount of their whole life policy's cash value.