B. Do both you and your spouse need life insurance? $86,000 C. $98,000 D. $172,000 E. $217,000. The maturity benefit is Rs. The ending balance in Accounts Payable and Accrued Liabilities was$1,935. 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. . On occurrence of first death or diagnosis of terminal illness, to either of you, the sum assured on death corresponding to the affected life is paid and the policy continues with life cover for the other life with reduced premium. Collection of advance premium shall be allowed within the same financial year for the premium due in that financial year However, where the premium due in a financial year is being collected in previous financial year, the premium may be collected for a maximum period of three months in advance of the due date of the premium. Which of the following is a charge you will pay when you purchase a variable annuity? to work after your death. 39. E. Pay taxes. \text{Short-term investments}&&\text{7,666}\\ Insurance Premium to work after your death. Table lamp. B. 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? 42. D. Decreasing term. 37. refunds of$11,200 were given. In most cases, the life insurance offered to the stay-at-home spouse depends on the coverage and income of the earning counterpart. A. Bill is worried about being able to pay his premium if he is totally and permanently disabled before age 60. Catherine Carey has made the choice to stay home and raise her three kids while her husband works. nonworking spouse whose youngest child is 5 years old? The second is the DINK method. C. Her contingent beneficiaries. loans. 200 lessons. The Wealth Curve Talk with John L. Smallwood. Adult child living with parents. Benefits of Life Insurance Insurance Need: . Collect premiums for the insurance contract. Fred bought life insurance five years ago. 67. Reasons for Life Insurance Claim Rejection, Head Office : 139 P Sector - 44,Gurugram - 122003Haryana, India, www.lifeinscouncil.org | IRDAI Registration no: 136. www.irdai.gov.in WEBNJV3CHODEC17 ENG | CIN: U66010DL2007PLC248825. Your spouse expects to continue to work after your death. 1. Further, you estimate that your funeral will cost $6,000. Holly and Matt want to use the "nonworking" spouse method to determine the amount of life insurance coverage they need. Which of the following statements is correct? False. Which of the following allows an individual to receive a fixed amount of income over a certain period of time, or over his or her life? Estimate how much life insurance Shaan and Anita should carry. The first is the easy method. A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period. The return on its investments. makes about $38,000 annually. She, wants to determine her insurance needs. A term insurance plan will also help to save taxes on the premiums under Section 80C of the IT Act. 1. Student services 37,700 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. If you are new to Smallwood Wealth schedule a Wealth Curve Conversation. Whole life. The provisions of Income Tax Act, 1961 are subject to amendments made by the government from time to time. The premium so collected in advance shall only be adjusted on the due date of the premium. Of course, it would be a tragedy were something to happen to your spouse. 38. determine the minimum amount of life insurance you should carry. B. Bens beneficiaries. Besides getting money into the family, the non-working spouse holds a responsibility for everything that doesnt offer bonus, perks, and promotions. Life insurance companies issue a lot of paperwork. $12,000 in 15 years. The "Nonworking" spouse method of estimating life insurance includes factors such as Social Security and liquid assets. Agency Problem in Finance Overview, Duties & Examples | What is the Agency Problem? Further, you estimate that your funeral will cost $6,000. Protect the people who depend on the insured from financial losses caused by his or her death. 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. In many cases, the answer is yes. Fixed annuity B. Now, you take this number and subtract your available assets from this number. To Buy: 1800-258-5899 (9:30 AM to 6:30 PM), For Existing Policy: 1800-103-0003/ 1800-180-0003/ 1800-891-0003, Managing Director & Chief Executive Officer. Is equipment floater the same as inland marine? A deferred annuity allows an individual to receive payments from an annuity at some future date. The premiums & funds are subject to certain charges related to the fund or to the premium paid. NOT INSURED BY ANY STATE OR FEDERAL AGENCY. Ag;sE2/yNNF;eF]!hiV^r^l PK ! Prepare journal entries in good form to record the foregoing transactions for the year ended June 30, 2020. Related to the expenses incurred: prepaid assets of $534 were used,$4,776 of the expenses were accrued, and the remaining expenses were paid. B. Renewable term. A. 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. Another name for temporary life insurance is A. Income replacement is one of the main reasons many people, especially those who have loved ones depending on them financially, have life insurance. 700 cartons to be stored. Limited installment payment. 82. nonworking spouse whose youngest child is 6 years old? 76. B. When can I switch from original Medicare to an Advantage plan? A. B. E. Your premium will be higher than a whole life policy premium. The death benefit will be increased by the amount of an outstanding policy loan. Before you purchase, be sure to talk to your financial professional about the annuitys features, benefits, and fees and whether the annuity is appropriate for you, based on your financial situation and objectives. You are the wage earner in a typical family, with $55,000 gross annual income. E. All of these affect the price. 2. After you purchase a life insurance contract, you have a "free look" period that lasts A. Can I stay on my parents insurance if I file taxes independently? Nonworking spouse method is a type of insurance policy where without working you can support your children until they turn 18 years old. $18,000 C. $50,000 D. $130,000 E. $180,000, 84. Let's review. If you have a conversion term policy, A. STEINERCOLLEGEStatementofFinancialPositionJune30,2019(amountsinthousands)\begin{array}{c} Jeanne wants to purchase a life insurance policy with guaranteed premiums. 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. age 35 may expect to live. A. Purchasing a life insurance policy is a basic and inexpensive task. Your annual income is $100,000. The maturity benefit in form of a lumpsum benefit equal to Rs.33,19,055 is paid at the end of the 20th year, provided the policy is in-force and all due premiums have been paid. C. It is better to fund a variable annuity before fully funding your IRA, Keogh, or 401(k). C. You can convert your term policy to a permanent policy. Estimate your total They own a home with a $125,000 mortgage; they owe $25,000 for their car loans and have $22,000 in student loans. 78. T&C apply. The rule of 70 is a means of estimating the number of years it takes for an investment or your money to double. A. Waiver of premium disability benefit B. Plus, get practice tests, quizzes, and personalized coaching to help you Which of the following policies should she buy? This is also the most thorough method. Were your family to lose that, you lose all of that labor. Stephanie is the wage earner in a "typical family" with $40,000 gross annual income. a. a way of calculating an inventory's value What is Life Insurance? 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. A. Catherine Carey has made the choice to stay home, and raise her three kids while her husband works. Life insurance companies understand that taking care of the home is invaluable and is equally important as earning an income for the household. Term insurance C. Whole insurance D. Variable annuity E. 401(k), 77. Which of the following is NOT important when buying life insurance? Please check your entries and try again. A. E. No interest will accumulate for any loans related to life insurance. They have determined that their annual income is $70,000 and their net worth is now $150,000. B. A. Adjustable life B. For example, if your gross income is $65,000, then with the easy method, your life insurance requirement is ($65,000 * 0.7) * 7 = $318,500. Your spouses cover must be useful to pay for childcare expenses and all the help you need around the house. 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. 5% B. E. Whole life insurance plans. \textbf{STEINER COLLEGE}\\ Steiner Colleges statement of financial position for the year ended June 30, 2019, is presented here. C. The policy will return all premiums if you survive to the end of the policy. Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits. 59. Factors That Affect Life Insurance Premiums Academic support 23,300 The rule of 70 and the rule of 72 give rough estimates of the number of years it would take for a certain variable to double. Which of the following is NOT temporary insurance? Claim Settlement Ratio A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period, 57. 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. \textbf{Statement of Financial Position}\\ Cross), Campbell Biology (Jane B. Reece; Lisa A. Urry; Michael L. Cain; Steven A. Wasserman; Peter V. Minorsky), Psychology (David G. Myers; C. Nathan DeWall), The Methodology of the Social Sciences (Max Weber), Civilization and its Discontents (Sigmund Freud), Principles of Environmental Science (William P. Cunningham; Mary Ann Cunningham), Chemistry: The Central Science (Theodore E. Brown; H. Eugene H LeMay; Bruce E. Bursten; Catherine Murphy; Patrick Woodward), Give Me Liberty! $10,000 + ($30,000 / 2) + ($11,000 / 2) + ($5,000 / 2) = $10,000 + $15,000 + $5,500 + $2,500 = $33,000. Determine an estimated regression equation that can be used to predict the overall score given the score for Shore Excursions. Allison is a "nonworking" spouse who devotes all of her time to household activities. Can you get life insurance on a spouse? Preserved the tax advantage of annuities but curtailed deductions for IRAs. All of the following are major rating agencies for insurance except A. A. \quad\qquad\text{Total liabilities and net assets}&&\underline{\underline{\text{\$\hspace{1pt}455,670}}}\\ NOT BANK GUARANTEED. 2003-2023 Chegg Inc. All rights reserved. If you find the policy or discover paperwork that indicates a policy exists, contact the insurer. Jumping the Wealth Curve with Edward E. Bao Jr. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. This is a very common type of policy taken by homeowners who want to support their children financially. Whole life B. B. \quad\text{Deposits held in custody for others}&&\text{700}\\ Securities offered through Purshe Kaplan Sterling Investments, MemberFINRA/SIPCHeadquartered at 80 State Street, Albany, NY 12207. 65. E. Made all annuities tax free. Sum Assured fixed at Rs. You should be able to collect the life insurance payout within 30 to 60 days after you have submitted the completed claim forms and the supporting documents. 69. Most participating policies are sold by: 102. E. None of these. A. Which method are they using to determine their life insurance needs? 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. I feel like its a lifeline. Question: Problem 12-10 Using the "Nonworking" Spouse Method to Determine Life Insurance Needs [LO12-2] Tim and Allison are married and have two children, ages 16 and 17 . You heard about several methods you can use to calculate your life insurance needs. Protection against loss of life for a specified term. In other words, you will have to show why you want to insure the individual. E. Proceeds left with the company. Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family need method, 31. This problem has been solved! Fixed Insurance products and services offered through Ash Brokerage or Smallwood Associates, Ltd. False. \text{Pledges receivable (net of doubtful accounts of \$280)}&&\text{5,872}\\ For example, say you have a remaining mortgage of $30,000, a credit card balance of $11,000, and a personal loan of $5,000. She may need to change her coverage as her needs change. 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! You estimate that funeral expenses will be $5,000. Money Market | Graph, Demand Curve & Model, Rate of Return Formula & Examples| How to Calculate the Rate of Return, Bank Liabilities & Assets | Overview, Differences & Examples, How to Choose a Career: Guidance Counseling, Principles of Macroeconomics: Certificate Program, Principles of Microeconomics Syllabus Resource & Lesson Plans, AEPA Economics (AZ035): Practice & Study Guide, Holt McDougal Economics - Concepts and Choices: Online Textbook Help, DSST Personal Finance: Study Guide & Test Prep, Hawaii Real Estate Salesperson Exam: Study Guide & Practice, CPA Subtest III - Financial Accounting & Reporting (FAR): Study Guide & Practice, Glencoe Earth Science: Online Textbook Help, Holt McDougal Algebra 2: Online Textbook Help, McDougal Littell Algebra 2: Online Textbook Help, Create an account to start this course today. They plan to purchase life insurance using this formula: (18 - Youngest child's age) $10,000.