Florida Life and Health Insurance License Practice Test 2025 - Free Insurance Practice Questions and Study Guide

Question: 1 / 400

A life insurance policy that provides a policyowner with cash value along with a level face amount is called?

Term life

Universal life

Whole life

A) Term life insurance policies do not accumulate any cash value, as they provide only a death benefit for a specified period of time.

B) Universal life insurance allows the policyowner to adjust their premium and death benefit amounts, and while there is a cash value component, it is not guaranteed like in whole life.

D) Variable life insurance also has a cash value element, but the policyowner can choose how the cash value is invested, making it a riskier policy compared to whole life.

In contrast, whole life insurance provides a guaranteed level premium and death benefit, as well as a guaranteed cash value component. This means that the policyowner can rely on both a set amount of coverage and an accumulation of cash value over time. Therefore, the correct answer is C.

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Variable life

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