Section 8 Flashcards
What is not a reason for a business to buy key person life insurance?
An increased pension liability, if the key employee dies
Which of these is not relevant when determining the amount of personal life insurance needed?
Existing life insurance coverage
Local unemployment rates
Household income
Household debt
Local unemployment rates
Which of these factors does not influence an individuals need for life insurance?
Lifestyle of the applicant
Number of dependents
Future educational costs of the dependents
Self maintenance expenses
Self maintenance expenses
According to the needs approach, an emergency reserve fund’s primary purpose is to…
Cover the cost of unexpected expenses
When using the needs approach for life, insurance planning, a lump sum may be created to provide for all of the following, except…
Final expenses
Charitable donation
Education
Employee benefits
Employee benefits
With life insurance, the needs approach is used primarily in determining…
How much life insurance a client should apply for 
Which of the following disability buy-sell agreements is best suited for businesses with a limited number of partners?
Cross purchase agreement
Employers often purchase life insurance on a key employee in order to
Pay for finding and training a replacement, if the employee dies prematurely
XYZ Corp. gives money to an employee to purchase a life insurance policy and allows the employee to select the beneficiary. What kind of plan is this?
Split-dollar
Which of these is not considered to be a cost connected with an individuals death?
Funeral expenses
Tax liability
Business expenses
Probate costs
Business expenses
