Over half of Americans have put off purchasing life insurance because they lack information, according to the Life Insurance Marketing and Research Association (LIMRA). Take this quiz to test your knowledge and get your questions answered.
1. According to LIMRA, the median life insurance payout for employer-provided coverage is:
a. $250,000
b. $500,000
c. $20,000 or one year’s salary
d. $50,000 or one year’s salary
2. How much life insurance do experts recommend you carry?
a. At least 6 times your annual income
b. At least 10 times your annual income
c. $1 million
d. $500,000
3. A life insurance payout can be used to:
a. Pay off a mortgage
b. Finance your children’s college education
c. Cover your burial and funeral costs
d. All of the above
4. When should you buy life insurance?
a. Once you turn 60
b. When you have dependents who rely on your income or you acquire debt
c. When you have a serious health scare
d. As soon as you start earning an income
5. What is a term life insurance policy?
a. A policy that only covers you for a certain number of years
b. A policy that covers you until you die
c. A policy that doesn’t pay out death benefits
d. A policy with no expiration date
6. Which of the following does not affect your monthly premium?
a. Your income level
b. Your gender
c. Your family medical history
d. Your lifestyle, including recreational sports
7. What is a “rider”?
a. The individual insured under the policy
b. A policy add-on that offers additional benefits
c. The insurance company
d. The insured’s children
8. The average cost of term life insurance for a healthy, non-smoking 30-year-old, according to LIMRA, is:
a. $260/year
b. $230/year
c. $200/year
d. $170/year
9. What is a beneficiary?
a. The agent who sold you the policy
b. The person who pays the premiums
c. The person who you named in the policy to receive the death benefit
d. The company that issued the policy
10. Which of the following can void your policy?
a. Missing a monthly payment
b. Dying while committing a crime
c. Scuba diving
d. All of the above
11. What does this mean and why does it matter? “Life insurance is not subject to probate court.”
a. Life insurance only pays the named beneficiaries after the court says it’s OK.
b. Life insurance cannot be used to pay debts.
c. Life insurance pays your beneficiaries directly, giving them immediate access to cash, even while your estate remains unsettled for months or years.
d. Probate court is not a real thing.
Answers:
-
c
-
b
-
d
-
b
-
a
-
a
-
b
-
d
-
c
-
d
-
c
