Answer True or False about Life Insurence: 1) Premiums for permanent insurance are often higher when...

Answer True or False about Life Insurence:

1) Premiums for permanent insurance are often higher when compared to term; however, permanent policies have the potential to build cash value that you can withdraw or borrow from if the need arises. Unpaid loans and withdrawals will reduce the death benefit and there may be tax consequences.

2) Riders that are part of your life insurance policy are free. They are marketing devices used by insurance companies.

3) Smoking increases your risk of mortality within a specified period and this is why smokers pay higher life insurance premiums.

4) The beneficiary of a life insurance policy is responsible for making the premium payments.

5) The expenses of a life insurance company have no bearing on the premiums the company charges.

Expert Solution

1. True- Permanent policies are costly.

2. False- Riders provide additional benefits and are not free

3. True- Smoking increase chances of early death resulting in higher premium.

4) False- Beneficiary of life insurance policy is always nominee appointed by premium payer.

5)False- Expenses of life insurance is included in premium cost.

jeff jeffy answered 1 year ago

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