In case of death of the Life Assured during the Policy Term, Sum Assured on Death basis the Coverage option opted, less cumulative monthly income(s) already paid shall be payable. Securities offered through Purshe Kaplan Sterling Investments, MemberFINRA/SIPCHeadquartered at 80 State Street, Albany, NY 12207. d. a way of shipping goods to customers Is life insurance for married couples cheaper? You want to purchase a life insurance policy that pays a dividend. Most people buy life insurance to A. They have determined that their annual income is $70,000 and their net worth is now $150,000. Stephanie is the wage earner in a "typical family" with $40,000 gross annual income. Allison is a "nonworking" spouse who devotes all of her time to household activities. D. Her parents. This gives you seven years of wages at 70%. This method is used only to calculate child care needs, not the total financial needs of the family. The "Family Need" method of estimating life insurance includes factors such as Social Security and liquid assets, Mutual life insurance companies specialize in the sale of nonparticipating policies, Another name for straight term is renewable return-of-premium term, Decreasing term pays less to the beneficiary as time passes, Return-of-Premium term pays out all premiums plus interest to a beneficiary. $13,000 B. You have a gross annual income of $62,000. B. 3.The maturity benefit calculated for a 25 years old healthy male who has opted for Canara HSBC Life Insurance Guaranteed Savings Plan with Guaranteed Savings Option through insurers website, annual premium Rs. Continuing a mini-series on life insurance, he discusses life insurance for spouse (who does not work or who works part-time). D. It builds cash value. The average cost of life insurance is $27 a month. Pay off a mortgage. Francisco and Maria have three children and want to complete a detailed worksheet to determine the amount of life insurance they need to purchase. The Policy Term, Premium Payment Term and the premium payment mode remains the same for the Spouse, as yours. You and your spouse are in good health and have reasonably secure jobs. Shaan and Anita are married and have two children, ages 4 and 7. It is important to replace all of the income lost when an employed family member dies when using the human-life approach. If you are new to Smallwood Wealth schedule a Wealth Curve Conversation here. D. Your premium will not increase when you renew it. \end{array} nonworking spouse whose youngest child is 5 years old? In contrast to the biopsychosocial model, the biomedical model views health as ___________. The total debts of you and your spouse include the following: mortgage, $200,000; auto loan, $16,000; credit card balance, $2,000; and personal debts of $4,000. Agency Problem in Finance Overview, Duties & Examples | What is the Agency Problem? Factors That Affect Life Insurance Premiums $4,000. If you are new to Smallwood Wealth schedule a Wealth Curve Conversation. What is a Rider on a Life Insurance Policy? A. Can I stay on my parents insurance if I file taxes independently? ^Individual death claims settled and reported in public disclosures for FY 2021-22. Another name for a straight term policy is A. Renewable term. You own a home with a mortgage of $110,000, and Trade Logo of Canara HSBC Life Insurance Company Limited (formerly known as Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd) hereinafter referred to as "Insurer" is used under license with Canara Bank and HSBC Group Management Services Limited. If you have a conversion term policy, A. PK ! B. 74. A process has specification limits of LSL 5 540 and USL 5 550. In many cases, the answer is yes. 2003-2023 Chegg Inc. All rights reserved. 3 days. Do both you and your spouse need life insurance? Estimate how much life insurance Shaan and Anita should carry. A. B. Mortality and expense risk charge. \text{Liabilities:}\\ Straight life. D. Your policy will have the same premium as other term policies. Which of the following riders should he consider? C. A life insurance policy allows an individual to receive payments from an annuity at once. Find the CpC_pCp and CpkC_{pk}Cpk capability indexes if. C. The mortality rate it expects among its policy holders. D. An annuity is more advisable for people in poor health than for those who are likely to live longer than average. 68. The big question is how much term life insurance for the non-working spouse (or stay-at-home parent) you should have. \textbf{Statement of Financial Position}\\ Megan wants to purchase a life insurance policy that will allow her to invest in stock. Which of the following statements is correct? Tuition waivers of $17,300 for students serving as teaching assistants for instruction were accrued. It also collected $820 of Pledges Receivable that were unrestricted. What is the amount of life insurance they should carry using the easy method? Non-Working Spouse Method. 25% C. 50% D. 75% E. 95%, 32. What are the stages of the General Adaptation Syndrome (GAS)? You and your spouse have the following debts: Using the nonworking spouse method, what should be the life insurance needs for a The Wealth Curve Talk with John L. Smallwood. When using the rule of 70, the number 70 is used in the calculation. How long is the grace period for health insurance policies with monthly due premiums? Insurance Contract Characteristics | Traits Specific to Insurance Contracts, Future Value Formula & Examples | How to Calculate Future Value. Note: The categorization of Spouse into Working and Non-Working will be as per the Companys Board Approved Underwriting Policy (BAUP). C. Convertible term. Which of the following life insurance policies should she apply for? 'QP2?^03dw 6x ;!;RTkz}Sc;)iI Molly is thinking about buying a life insurance policy, but she is not sure about how much she will need in the next few years. A. Step 1 Non-working spouse method: This method is form of insurance coverage that allows you to s. B. 70. to work after your death. 35. If marriage has taken place after the policy commencement date, you can add the Spouse to your policy within one year from the date of the marriage. D. You must pay interest on any outstanding policy loans. Multiply the income . If you mean you want to add life insurance coverage for your new spouse on your life insurance policy, you can contact your life insurance agent or carrier and request what it would cost to add a spouse rider for life insurance coverage to your existing policy. Yes! \textbf{(amounts in thousands)}\\ Each of you \quad\qquad\text{Total liabilities and net assets}&&\underline{\underline{\text{\$\hspace{1pt}455,670}}}\\ Fixed Insurance products and services offered through Ash Brokerage or Smallwood Associates, Ltd. lessons in math, English, science, history, and more. 37. Your needs will also change over time, so your life insurance needs may also change over time. B. Multiyear level term. D. Household with children. This is a method that has you adding half of all your debts plus funeral expenses. $343,000 C. $490,000 D. $700,000 E. $750,000, 86. 45. $40,000 B. Let's review. If you switch life insurance policies, you will automatically still be insurable, Annuities are most beneficial for individuals who expect to live only a short time, An investment in an annuity is the same as an investment in a certificate of deposit, Tuitionandfeesreceivable(netofdoubtfulaccountsof$12), Pledgesreceivable(netofdoubtfulaccountsof$280), Property,plan,andequipment(netofaccumulateddepreciationof$104,240), Investments(atfairvalue,costof$162,000), Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Fundamentals of Financial Management, Concise Edition. This website helped me pass! Which of the following allows an individual to receive an amount of income that will change based on the income received from stocks or other investments over a certain period of time, or over his or her life? Under this plan option, a Monthly Survival Income shall be payable at the beginning of each month, starting from the Policy Anniversary coinciding with or following the Life Assured attaining age 60 years (last birthday) which shall continue till the end of the Policy Term or the death of the Life Assured whichever is earlier. Premium payments are fixed with a Variable Life Policy, The beneficiaries of someone who dies by suicide will never be eligible to receive any benefits from his or her life insurance policy. D. Life income option. A. D. A fixed annuity is one where the investments made into the annuity are variable. E. None of these. Fixed annuity B. Tim and Tammy are updating their financial plan and are concerned that they might not have enough life insurance coverage for their family, which includes two children, ages 4 and 10. You policy will continue for one year. $343,000 C. $490,000 D. $700,000 E. $750,000, 85. 59. 42. Which of the following is NOT important when buying life insurance? Yes. A. Adjustable life B. A. All guarantees are based on the continued claims paying ability of the issuing company. \text{Investments (at fair value, cost of \$162,000)}&&\underline{\text{\hspace{5pt}158,400}}\\ 47. 5EPhGD!A'b1^:x[)(2##19pH`G0v#/(5;dI(D The goal of this approach is to replace the primary breadwinner's salary for a predetermined number of years. This next method is for those with just one wage earner in the family. False. Replacement value is a method for determining what an insurance company will pay you in case your property is stolen or destroyed. Lastly, it allows you to keep your future obligations: college, paying off debts, weddings, bar mitzvahs and bat mitzvahs, sweet sixteens, and all the other things that you want to do for your kids. Catherine Carey has made the choice to stay home and raise her three kids while her husband works. Then compute this number as an annual cost and multiply by the approximate number of years you would need those services, say until your children start going to college, or until you retire to take care of the house yourself. - Definition & Types, Influencer in Marketing: Definition & Overview, Intangibility in Marketing: Definition & Overview, Learned Behavior in Marketing: Definition, Types & Examples, Marketing Orientation: Definition & Examples, Schedule Variance: Definition, Formula & Calculation, Unique Selling Proposition (USP): Examples & Definition, What Is Product Placement? You can convert your policy to a permanent type at the end of the term. Most modern insurance covers let you add your spouse under the same policy for an additional premium, often lower than your own premium. The rule of 70 is a means of estimating the number of years it takes for an investment or your money to double. The Policy will terminate after payment of this benefit. Insurance Need: . 65. C. 10 days. They plan to purchase life insurance using this formula: (18 - Youngest child's age) $10,000. The premiums & funds are subject to certain charges related to the fund or to the premium paid. When it comes to purchasing life insurance, you need to make sure you are purchasing enough coverage to cover all your financial needs upon your death. The most common settlement option for a life insurance program is the lump-sum payment. The "Nonworking" spouse method of estimating life insurance includes factors such as Social Security and liquid assets. They own a home with a $125,000 mortgage; they owe $25,000 for their car loans and have $22,000 in student loans. A deferred annuity allows an individual to receive payments from a life insurance policy immediately. How to estimate life insurance requirements for a non working spouse? Holly and Matt want to use the "nonworking" spouse method to determine the amount of life insurance coverage they need. Which of the following provisions will affect the amount of money his beneficiaries will receive? Another name for permanent life insurance is A. Ask a Family Member's Financial Advisor. C. Temporary insurance. A. The settlement option in which the company acts as trustee and pays interest to the beneficiary is called A. Lump-sum payment. . Each plans to continue to work after the other one dies. The first is the easy method. C. Her contingent beneficiaries. Another name for temporary life insurance is A. The capital retention method is a method of determining the amount of life insurance needed by using an interest-only model to support your family. the near future. The recommendation is to have seven to ten years of life insurance. Find the symmetric intervals around the mean of 175mg/dL175 \mathrm{mg} / \mathrm{dL}175mg/dL that respectively include the cholesterol levels of 68.3%,95.4%68.3 \%, 95.4 \%68.3%,95.4%, and 99.7%99.7 \%99.7% of all children. Which of the following products allows an individual to receive payments beginning now? E. None of these is correct. Its free, with no obligation. Protection against loss of life for a specified term. The death benefit will be increased by the amount of an outstanding policy loan. Preserved the tax advantage of annuities but curtailed deductions for IRAs. Has the option to select any Coverage Option, any Optional In-Built Cover and any Benefit Payout Option at the stage of getting added for coverage under the policy. Estimate how much life insurance Tim and Allison should carry. An individual can take out a loan on his or her term policy. Fred bought life insurance when he was 47, although he told the insurance company that he was 42. 39. This term life policy will guarantee that you will pay the same premium for the duration of your policy. The settlement option that pays the life insurance proceeds in equal periodic payments for a specified number of years after your death is called A. Lump-sum payment. The spouse who has to stay at home, looking after the children, cooking, and supporting the family often has a more tiresome job to do, than the working spouse. loans. Limited installment payment. This is a very common type of policy taken by homeowners who want to support their children financially. Single adult living alone. A. Waiver of premium disability benefit B. Let us have a look at your work and suggest how to improve it! A. Contract. What will be the surrender value of LIC policy after 5 years? E. Child. Now, you take this number and subtract your available assets from this number. 93. Annuity Formula, Calculation & Examples | What is an Annuity? If, for example, your account earns 4 percent, divide 72 by 4 to get the number of years it will take for your money to double. \quad\text{With donor restrictions}&\underline{\text{\hspace{5pt}229,940}}\\ Insurance needed. C. Identified annuities to be the same as certificates of deposit. 12-3 Estimate how much life insurance Tim and Allison should carry to cover Allison. D. Term life insurance plans. How much term does a non-working spouse get? B. Fixed annuity B. Past performance of the investment funds do not indicate the future performance of the same. Your annual income is $60,000. insurance needs for a family whose youngest child is 5 years Use And a term insurance cover for house makers, non-working spouses, or say a housewife, proves helpful exactly here, ensuring your family tides over the financial damages in case something unfortunate happens. B. A. Waiver of premium disability benefit B. This communication strictly intended for individuals residing in the states of CA, CO, CT, DC, DE, FL, GA, IL, LA, MA, ME, NC, NH, NJ, NM, NY, OH, PA, RI, SC, TX, UT, VA. No offers may be made or accepted from any resident outside these states due to various regulations and registration requirements regarding investment products and services. D. The policy features. It's a method that has you calculating your immediate needs upon death, adding it to the ongoing needs of surviving family members, and then subtracting your available assets. A. The question is, how big are yours? Bonnie is most concerned about being able to buy additional insurance without undergoing medical exams. Bill is worried about being able to pay his premium if he is totally and permanently disabled before age 60. There's no one-size-fits-all answer to this because every family is different, but a 15- to 20-year policy between $250,000400,000 is a general rule. Using the DINK method, what should be your need for life insurance? You may need to change your coverage amounts when this happens. Such advance premium, if any, paid by the Policyholder shall not carry any interest. Which of the following is a poor choice for the amount of protection offered for an individual? Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits, 62. T&C Apply. The income replacement approach is a method of determining the amount of life insurance you should purchase. Pam just started working at XYZ Widget Company and finally wants to get insurance coverage. Life insurance companies understand that taking care of the home is invaluable and is equally important as earning an income for the household. All rights reserved. The human-life approach is a method of calculating how much life insurance is needed for a family that is based upon their financial loss when the insured person in the family passes away. Investment Advisory Services provided by Smallwood Wealth Investment Management, LLC, an SEC registered investment advisor. Use the multiple of income method to See Answer Your premium may increase if you continue it for another term because you will be older. nonworking spouse whose youngest child is 5 years old? \text{Property, plan, and equipment (net of accumulated depreciation of \$104,240)}&&\text{281,404}\\ Diffusion Let us complete them for you. What is your life insurance need using the DINK method? What kind of policy would you want to purchase? Using the nonworking spouse method, what should be the life Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits. 79. Using the "nonworking" spouse method, what should, be the life insurance need for a family whose youngest, 95. Using the "nonworking" spouse method, what should, be the life insurance needs for a family whose youngest, 94. A. D. 30 days. Further, you estimate that your funeral will cost $6,000. Its like a teacher waved a magic wand and did the work for me. Plus, get practice tests, quizzes, and personalized coaching to help you A Limited Payment Policy is a while life policy that requires premiums to be paid for a certain period. 25,00,000 which will remain same throughout the Policy Term. Dividend policy B. Nonparticipating policy C. Mutual policy D. Participating policy E. Stock policy, 34. To unlock this lesson you must be a Study.com Member. Mortgage = $190,000; Auto loan = $10,000; Credit card balance = $2,000; and other debts = Easy method C. DINK method D. Family need E. Soccer mom 95. You are a dual-income, no-kids family. Having life insurance for income replacement means if you pass away, your family could have the financial support they need to maintain the lifestyle they're used to. Investments are not FDIC- or NCUA-insured, are not guaranteed by a bank/financial institution, and are subject to risks, including possible loss of the principal invested. is your life insurance need based on the easy method? Time Value of Money Formula & Examples | What is Time Value of Money? A term insurance plan will also help to save taxes on the premiums under Section 80C of the IT Act. a. a way of calculating an inventory's value Likewise, when using the rule of 72, the number 72 is used in the calculation. Academic support 23,300 A. makes about $38,000 annually. What kind of policy would she want to purchase? A. Waiver of premium disability benefit B. Can you get life insurance on a spouse? The rule of 70 is a calculation to determine how many years it'll take for your money to double given a specified rate of return. 24. You estimate that funeral expenses will be $5,000. Fred bought life insurance five years ago. Life insurance benefits may be used to pay off a home mortgage or other debts at the time of death. Jeff and Erica have two children. B. NOT INSURED BY ANY STATE OR FEDERAL AGENCY. The maturity benefit is calculated for a 25 years old healthy male life who has opted for Canara HSBC Life Insurance iSelect Guaranteed Future with iAchieve plan option, monthly premium Rs.10,000 (excluding taxes), premium payment term 10 years and policy term 20 years through online sales channel. C. Tell you why her product is better than the competitors. C. Final life payment. An interest-adjusted index is a method of evaluating the cost of life insurance by taking into account the time value of money, The lower the interest-adjusted index, the lower the cost of a life insurance policy, If you change your mind about your insurance policy, you have 60 days to return it to receive a refund of your premium. You have a spouse, two kids, a dog and a mortgage - a typical family. In most cases in India, the non-working spouse is a woman and it may be unimaginable to account for the financial implications in case of their absence, keep aside the emotional damage. 58. Important Life Insurance Policy Provisions, After-Tax Rate of Return: Definition & Formula, Standard Deviation of Returns | Overview, Investment Volatility & Formula. D. A deferred annuity allows an individual to receive payments from a life insurance policy at some future date. Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits, 63. A. A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period, 57. Futures Contract in Finance Purpose & Examples | What Are Futures? She, wants to determine her insurance needs. After you purchase a life insurance contract, you have a "free look" period that lasts A. Which of the following riders provided an additional benefit for his heirs? E. Credit life. E. Made all annuities tax free. E. Proceeds left with the company. Institutional support 28,500. $18,000 C. $50,000 D. $130,000 E. $180,000, 84. Secondly, consider the value of the unpaid work done by a spouse who spends much of their time raising children. U ^s1xRpbD#rYNrJC.aeD=U]Sik@X6G[:b4(uH%-+0A?t>vT9. For example, your life insurance coverage amount will need to pay for funeral expenses, any outstanding debts, any remaining mortgage, and maybe even future financial support for a spouse or children. Polly wants the opportunity to change the amount she pays for her annual premium through the life of her insurance policy without changing her coverage. It equals the cost of replacing the property. Your annual income is $100,000. 97. Allison is a "nonworking" spouse who devotes all of her time to household activities. All other trademarks and copyrights are the property of their respective owners. 44. If you have a renewable term policy, A. A. Catherine Carey has made the choice to stay home, and raise her three kids while her husband works. During the year, charges for tuition and fees were $244,500; scholarships were$16,300; and tuition waivers for scholastic achievement were $5,100. B. A person who is named to receive the benefits from an insurance policy is a(n) A. C. Decreasing term. Life insurance is a wise purchase of all individuals. Your spouse expects to continue A. B. A. insurance needs for a family whose youngest child is 5 years D. Limited payment. Group life C. Limited life D. Universal life E. Variable life, 51.
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