LOMA 281 Module 2
Questions And
Answers(GRADED A)
Term Life insurance - ANSWER Insurance that provides a policy benefit if the insured dies during a
specified period of time.
Policy term - ANSWER The specified period of time for which a term life insurance policy provides
coverage.
Level Term life insurance - ANSWER A plan of term life insurance that provides a policy benefit that
remains the same over the term of 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 - ANSWER 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 - ANSWER A type of term life insurance designed to pay the balance due on a
loan if the borrower dies before the loan is paid
Family income coverage - ANSWER A plan of decreasing term life insurance that provides a stated
monthly income benefit amount to the insured's surviving spouse if the insured dies during the term
of coverage.
, Cash value - ANSWER The savings element of a cash value life insurance policy, which represents the
policyowner's ownership interest in the policy.
Policy loan - ANSWER A loan a policyowner receives from an insurer using the cash value of a life
insurance policy as security.
Cash surrender value - ANSWER The amount, after adjustments for 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 - ANSWER A type of limited-payment whole life insurance policy that
requires only one premium payment.
Limited premium payment - ANSWER A whole life insurance policy for which premiums are payable
only until some stated period expires or until the insured's death, whichever occurs first.
Continuous premium payment - ANSWER A whole life insurance policy for which premiums are
payable for the life of the policy. AKA straight life or ordinary life.
Modified premium whole life insurance - ANSWER A whole life insurance policy that functions in the
same manner as a traditional whole life policy except that the policy's annual premium changes after
a specified initial period, such as 5,10,15,20 years.
Modified coverage whole life insurance - ANSWER A whole life insurance policy under which the
amount of insurance decreases by specific percentages or amounts either when the insured reaches
certain stated ages or at the end of stated time periods.
Joint whole life insurance - ANSWER A plan of whole life insurance that has the same features and
benefits as individual whole life, except that it insures two lives under the same policy; the death
benefit is payable when the first insured dies.
Last survivor life insurance - ANSWER A variation of joint whole life insurance under which the policy
benefit is paid only after both people insured by the policy have died.
Universal life insurance - ANSWER A form of cash value life insurance that is characterized by
separate pricing factors, a flexible face amount and death benefits, and flexible premiums.
Questions And
Answers(GRADED A)
Term Life insurance - ANSWER Insurance that provides a policy benefit if the insured dies during a
specified period of time.
Policy term - ANSWER The specified period of time for which a term life insurance policy provides
coverage.
Level Term life insurance - ANSWER A plan of term life insurance that provides a policy benefit that
remains the same over the term of 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 - ANSWER 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 - ANSWER A type of term life insurance designed to pay the balance due on a
loan if the borrower dies before the loan is paid
Family income coverage - ANSWER A plan of decreasing term life insurance that provides a stated
monthly income benefit amount to the insured's surviving spouse if the insured dies during the term
of coverage.
, Cash value - ANSWER The savings element of a cash value life insurance policy, which represents the
policyowner's ownership interest in the policy.
Policy loan - ANSWER A loan a policyowner receives from an insurer using the cash value of a life
insurance policy as security.
Cash surrender value - ANSWER The amount, after adjustments for 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 - ANSWER A type of limited-payment whole life insurance policy that
requires only one premium payment.
Limited premium payment - ANSWER A whole life insurance policy for which premiums are payable
only until some stated period expires or until the insured's death, whichever occurs first.
Continuous premium payment - ANSWER A whole life insurance policy for which premiums are
payable for the life of the policy. AKA straight life or ordinary life.
Modified premium whole life insurance - ANSWER A whole life insurance policy that functions in the
same manner as a traditional whole life policy except that the policy's annual premium changes after
a specified initial period, such as 5,10,15,20 years.
Modified coverage whole life insurance - ANSWER A whole life insurance policy under which the
amount of insurance decreases by specific percentages or amounts either when the insured reaches
certain stated ages or at the end of stated time periods.
Joint whole life insurance - ANSWER A plan of whole life insurance that has the same features and
benefits as individual whole life, except that it insures two lives under the same policy; the death
benefit is payable when the first insured dies.
Last survivor life insurance - ANSWER A variation of joint whole life insurance under which the policy
benefit is paid only after both people insured by the policy have died.
Universal life insurance - ANSWER A form of cash value life insurance that is characterized by
separate pricing factors, a flexible face amount and death benefits, and flexible premiums.
