PSI Life Insurance and Life Producer Exam Practice Questions

The primary purpose of life insurance is to provide financial protection to beneficiaries upon the death of the insured.

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A term life insurance policy provides coverage for a specified period, such as 10, 20, or 30 years, and pays a death benefit only if the insured dies within that term.

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Whole life insurance is a type of permanent life insurance that provides coverage for the insureds entire life and includes a savings component known as cash value.

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The cash value in a whole life insurance policy is a savings component that grows over time and can be borrowed against or withdrawn by the policyholder.

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An endowment policy is a life insurance contract designed to pay a lump sum after a specific term (on its maturity) or on death.

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Universal life insurance is a type of permanent life insurance with flexible premiums, adjustable death benefits, and a savings component that can earn interest.

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Variable life insurance is a type of permanent life insurance where the cash value can be invested in a variety of separate accounts, similar to mutual funds, and the death benefit and cash value can fluctuate based on investment performance.

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Term life insurance provides coverage for a specific period and has no cash value, while whole life insurance provides lifelong coverage and includes a cash value component.

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