LOMA 281 Module 2 Exam With Verified Solutions 2024-2025
Term Insurance - Insurance that pays a policy benefit if the insured dies during a
specified period of time.
Policy Term- The period of time during which a term life insurance policy provides
coverage.
Level Term- A plan of term life insurance that provides a policy benefit that remains the
same throughout the duration of the coverage.
Decreasing term life insurance-Answer A plan of term life insurance that provides a
policy benefit that decrease in amount over the term of coverage.
Increasing term life insurance-Answer A plan of life insurance that provides a policy
benefit that starts at one amount and increases by some specified amount or percentage
at stated intervals over the term of coverage.
Mortgage insurance-a plan of decreasing term life insurance designed to provide a
benefit amount that corresponds to the decreasing amount owed on a mortgage loan
Credit life insurance-a form of term life insurance designed to pay the balance due on a
loan if a borrower dies before the loan is paid
Family income coverage - A plan of decreasing term life insurance providing a stated
monthly income benefit amount to the surviving spouse of the insured in the event the
insured dies during the term of coverage.
Return of premium term insurance - A form of term insurance that provides a death
benefit if the insured dies during the term of coverage and a return of the premiums if the
insured does not die during the period of coverage.
, Renewable term insurance - Answer Term life insurance that permits the policyowner to
renew the policy for another policy term without requiring evidence of insurability.
Evidence of insurability - Answer Proof that a person is an insurable risk.
Convertible term insurance - Answer Term life insurance that provides the policyowner
with the right to convert the term policy to a cash value life insurance policy without
providing evidence of insurability.
Conversion period - Answer The specified period of time following policy issue during
which the owner of a convertible term life insurance policy may convert the coverage to
cash value life insurance.
Original age conversion - A Answer Conversion of a term life insurance policy to a cash
value life insurance policy where the renewal premium rate is determined by the age of
the insured at the time the original term life insurance policy was issued.
Cash value life insurance - Answer Insurance providing both life insurance coverage to
the insured for his or her whole life and a savings component.
Cash value - The savings component of a cash value life insurance policy and the amount
that represents the policyowner's ownership interest in the policy.
Policy loan - A loan that an insurer makes to a policyowner based on the cash value of a
life insurance policy used as collateral.
Cash surrender value - a) The amount, net of factors such as policy loans, that the owner
of a cash value life insurance policy is entitled to receive upon surrendering the policy.
Single premium payment - d) A form of limited-payment whole life insurance that requires
only one premium payment.
Term Insurance - Insurance that pays a policy benefit if the insured dies during a
specified period of time.
Policy Term- The period of time during which a term life insurance policy provides
coverage.
Level Term- A plan of term life insurance that provides a policy benefit that remains the
same throughout the duration of the coverage.
Decreasing term life insurance-Answer A plan of term life insurance that provides a
policy benefit that decrease in amount over the term of coverage.
Increasing term life insurance-Answer A plan of life insurance that provides a policy
benefit that starts at one amount and increases by some specified amount or percentage
at stated intervals over the term of coverage.
Mortgage insurance-a plan of decreasing term life insurance designed to provide a
benefit amount that corresponds to the decreasing amount owed on a mortgage loan
Credit life insurance-a form of term life insurance designed to pay the balance due on a
loan if a borrower dies before the loan is paid
Family income coverage - A plan of decreasing term life insurance providing a stated
monthly income benefit amount to the surviving spouse of the insured in the event the
insured dies during the term of coverage.
Return of premium term insurance - A form of term insurance that provides a death
benefit if the insured dies during the term of coverage and a return of the premiums if the
insured does not die during the period of coverage.
, Renewable term insurance - Answer Term life insurance that permits the policyowner to
renew the policy for another policy term without requiring evidence of insurability.
Evidence of insurability - Answer Proof that a person is an insurable risk.
Convertible term insurance - Answer Term life insurance that provides the policyowner
with the right to convert the term policy to a cash value life insurance policy without
providing evidence of insurability.
Conversion period - Answer The specified period of time following policy issue during
which the owner of a convertible term life insurance policy may convert the coverage to
cash value life insurance.
Original age conversion - A Answer Conversion of a term life insurance policy to a cash
value life insurance policy where the renewal premium rate is determined by the age of
the insured at the time the original term life insurance policy was issued.
Cash value life insurance - Answer Insurance providing both life insurance coverage to
the insured for his or her whole life and a savings component.
Cash value - The savings component of a cash value life insurance policy and the amount
that represents the policyowner's ownership interest in the policy.
Policy loan - A loan that an insurer makes to a policyowner based on the cash value of a
life insurance policy used as collateral.
Cash surrender value - a) The amount, net of factors such as policy loans, that the owner
of a cash value life insurance policy is entitled to receive upon surrendering the policy.
Single premium payment - d) A form of limited-payment whole life insurance that requires
only one premium payment.
