A. An individual can take out a loan on his or her term policy. 78. age 35 may expect to live. Which of the following is NOT important when buying life insurance? 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The sooner a person is likely to die, the lower the premiums he or she will pay, Life expectancy for men is longer than that for women. Amy bought a life insurance policy and named Ben as her beneficiary. a. a way of calculating an inventory's value Your annual income is $100,000. Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits. The various funds offered under this contract are the names of the funds and do not in any way indicate the quality of these funds, their future prospects and returns. 25,00,000 which will remain same throughout the Policy Term. Insurance Premium If you are new to Smallwood Wealth schedule a Wealth Curve Conversation here. About ___ of the U.S. life insurance companies are stock companies. With the right term insurance policy in place, stay prepared for any adversity. Purshe Kaplan Sterling Investments and Smallwood Wealth Investment Management, LLC are not affiliated companies. $4,000. How to Buy Life Insurance: Steps & Choices, App. E. It is better to fund an IRA, Keogh, or 401(k) before buying an annuity. B. Life insurance is a wise purchase of all individuals. C. Final life payment. d. 28. determine the minimum amount of life insurance you should carry. This is a very common type of policy taken by homeowners who want to support their children financially. Which of the following statements is incorrect? Group life C. Limited life D. Universal life E. Variable life, 51. The most common settlement option for a life insurance program is the lump-sum payment. This method is used only to calculate child care needs, not the total financial needs of the family. Estimate your total The policy terminates only after the sum assured on death or diagnosis of Terminal Illness of the second life, or on maturity of the policy term, thereafter. The non-working spouse method is a method that has you multiplying the number of years it takes the youngest child to reach 18 by $10,000. 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. Insurer. A. A deferred annuity allows an individual to receive payments from an annuity at some future date. Or, you can call us at (800) 797-1000. When deciding the right amount of coverage required for your spouse, everyones need may be different. The average cost of life insurance is $27 a month. This method is called the non-working spouse method. Steiner is a private college. Focus on Personal Finance: Online Textbook Help, Life Insurance Companies: Definition & Types, Psychological Research & Experimental Design, All Teacher Certification Test Prep Courses, How to Estimate Life Insurance Requirements. Allison is a "nonworking" spouse who devotes all of her time to household activities. Everyone is impacted by these 5 problems. All other trademarks and copyrights are the property of their respective owners. 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. You and your spouse have the following debts: Using the nonworking spouse method, what should be the life insurance needs for a Your needs will also change over time, so your life insurance needs may also change over time. . Which of the following is NOT a feature of whole life insurance? Option to add Optional In-Built Covers or choose a Benefit Payout Option other than Lumpsum is not available to non-Working Spouse. 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. A. U ^s1xRpbD#rYNrJC.aeD=U]Sik@X6G[:b4(uH%-+0A?t>vT9. Whole life B. Renewable term C. Convertible term D. Decreasing term E. Multiyear level. A. Adjustable life B. Another name for temporary life insurance is A. It equals the cost of replacing the property. C: Consumer Agencies & Organizations, CLEP Financial Accounting: Study Guide & Test Prep, Introduction to Financial Accounting: Certificate Program, High School Marketing for Teachers: Help & Review, How to Choose a College: Guidance Counseling, UExcel Workplace Communications with Computers: Study Guide & Test Prep, Effective Communication in the Workplace: Certificate Program, Effective Communication in the Workplace: Help and Review, CLEP Principles of Macroeconomics: Study Guide & Test Prep, Intro to Excel: Essential Training & Tutorials, Information Systems and Computer Applications: Certificate Program, GED Social Studies: Civics & Government, US History, Economics, Geography & World, What is Whole Life Insurance? The sooner a person is likely to die, the lower the premiums he or she will pay. NOT FDIC INSURED. Use the multiple of income method to This is based on data provided by Quotacy for a 40-year-old buying a 20-year, $500,000 term life policy, which is the most common term length and amount sold. Estimate how much life insurance Tim and Allison should carry. E. Weiss Research. 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. When using the rule of 70, the number 70 is used in the calculation. Explanation: Generally when there is only one working spouse in a household and you want to get insurance to cover child care needs, you can use the non-working spouse method which is very simple to calculate but will also carry a very low amount. E. Proceeds left with the company. the easy method to determine how much life insurance you should carry. E. An insurance company will calculate the annual amounts to pay each person for an annuity. This term life policy will guarantee that you will pay the same premium for the duration of your policy. It also collected $820 of Pledges Receivable that were unrestricted. Using the "nonworking" spouse method, what should be the life insurance need for a family whose youngest child is 10 years old? Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family needs method, 30. 5% B. Which of the following life insurance policies should she apply for? Quickly and professionally. 101. Course Hero is not sponsored or endorsed by any college or university. How much storage space is required? Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family needs method, 29. C. Moodys. But from a financial perspective, it does not have to be a crisisif you have good planning. The Policy will terminate after payment of this benefit. Of course, it would be a tragedy were something to happen to your spouse. Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family needs method. 66. A. This gives you seven years of wages at 70%. 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. During the year, charges for tuition and fees were $244,500; scholarships were$16,300; and tuition waivers for scholastic achievement were $5,100. Using time value of money and assuming you could invest your What kind of policy is he planning to purchase? old? Likewise, when using the rule of 72, the number 72 is used in the calculation. False. What is your life insurance need using the DINK method? Limited installment payment. When calculating an amount, ask yourself what it will cost to hire someone to replace your spouse and perform all the tasks your non-working spouse does throughout the day. 5. An error occurred trying to load this video. Determine an estimated regression equation that can be used to predict the overall score given the score for Shore Excursions. Amy has worked with students at all levels from those with special needs to those that are gifted. When you're ready to purchase life insurance, you'll need to decide what coverage amount you need so that all your financial obligations and needs are met upon your death. What happens if you don't pay your health insurance deductible? Net deposits returned to students totaled $10. 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. Related to the expenses incurred: prepaid assets of $534 were used,$4,776 of the expenses were accrued, and the remaining expenses were paid. \text{Tuition and fees receivable (net of doubtful accounts of \$12)}&&\text{230}\\ How do I know if my life insurance has cash value? An immediate annuity allows an individual to receive payments from an annuity beginning at once. Unit linked Insurance products are different from the traditional insurance products and are subject to the risk factors. 35. Which of the following provisions should she take action on? What kind of policy would you want to purchase? the income provider's salary. A deferred annuity allows an individual to receive payments from an annuity immediately. E. Proceeds left with the company. The income replacement approach is a method of determining the amount of life insurance you should purchase. The big question is how much term life insurance for the non-working spouse (or stay-at-home parent) you should have. DINK stands for double income, no kids. Look through financial records. D. Term life insurance plans. This is a method that has you multiplying the number of years it takes the youngest child to reach 18 by $10,000. It will take your youngest child 15 more years to reach 18. Limited installment payment. E. No interest will accumulate for any loans related to life insurance. \text{Liabilities:}\\ D. Allowed annuities to be purchased for individual retirement accounts. If you are a family and either you or your spouse stays home with the children, it is most likely that only the working souse has life insurance coverage because thats the case with most families in our country. Insurance Need: ? Such advance premium, if any, paid by the Policyholder shall not carry any interest. Life insurance benefits may be used to pay off a home mortgage or other debts at the time of death. This method has you multiplying the number of years it takes the youngest child to reach 18 by $10,000. 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. You can take out a life insurance policy on your spouse if you have an insurable interest. E. Cash value life. Beneficiary. This gives you 7 years of wages at 70%. Canara HSBC Life Insurance Company Limited is only the name of the insurance company and Canara HSBC Life Insurance Invest 4G is only the name of the unit linked insurance contract and does not in any way indicate the quality of the contract, its future prospects or returns. Factors That Affect Life Insurance Premiums Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family need method, 31. Using the DINK method, what should be your need for life insurance? All of the following are major rating agencies for insurance except A. Table lamp. Replacement value is a method for determining what an insurance company will pay you in case your property is stolen or destroyed. \quad\text{Unearned revenue}&&\text{900}\\ The process standard deviaton You pay premiums each year for the rest of your life. You have to drive them to their after-school activities, preparing meals, keeping the household in order, etc. A. The rule of 70 is a means of estimating the number of years it takes for an investment or your money to double. In order to have a valid policy, the owner must: To clearly illustrate your insurable interest. D. Limited payment. E. 60 days. 59. With an available asset of $500,000 in savings, your life insurance requirement is $1,355,000 - $500,000 = $855,000. E. Single year term. Using the sample chart that follows, find the column showing the age of the nonworking spouse 2. DESIGNED BY: INTERSOFT ASSOCIATES. Earnings Per Share Overview & Formula | How to Calculate EPS, Capital Budgeting Decisions | Examples, Techniques & Analysis, Activity-Based Costing | Formula, Examples & Benefits. NOT INSURED BY ANY STATE OR FEDERAL AGENCY. Can you buy life insurance for someone who is dying? Of course, it would be a tragedy were something to happen to your spouse. 40. With comprehensive coverage features like accidental benefit, increasing/ decreasing cover and whole life cover, the policy also offers a Spouse cover. C. Final life payment. This is a method that has you adding half of all your debts plus funeral expenses. What is the amount of life insurance they should carry using the easy method? When can I switch from original Medicare to an Advantage plan? The question is, how big are yours? Can someone be denied homeowners insurance? Jeff and Erica have two children. You have to drive them to and from school, oversee homework and music practice. 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. Adjusting entries for the period were made to increase Allowance for Doubtful Accounts by $20, to record depreciation expense of$26,400 (charged 70 percent to instruction and 30 percent to academic support), to adjust tuition revenue for an increase in unearned revenue of $10, and to recognize an increase in fair value of investments of$4,700 ($790 was related to investments restricted for scholarships,$1,610 was related to the permanent endowment, the remainder was related to net assets without donor restrictions). What. She does not want to take a medical exam to get coverage because she has some underlying health conditions and is concerned that she might not qualify for a policy. It accumulates cash value. Annuities are often purchased for A. 58. Home Flashcards Chapter 10 Personal Finance. Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits, 63. Contract. To go deeper on the insights from Smallwood Wealth Management, request your FREE COPY of. Now, if it's just you and your spouse, you can use the DINK method. Besides getting money into the family, the non-working spouse holds a responsibility for everything that doesnt offer bonus, perks, and promotions. you owe $11,000 on car loans, $2,000 in personal debt, and $3,000 in credit card \text{Short-term investments}&&\text{7,666}\\ Create your account, 18 chapters | 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. She may need to change her coverage as her needs change. Copyright 2023 StudeerSnel B.V., Keizersgracht 424, 1016 GC Amsterdam, KVK: 56829787, BTW: NL852321363B01, determine the minimum amount of life insurance you should carry, the easy method to determine how much life insurance you should carry. A. Here's how to calculate the estimated life insurance need: 1.