FFC Insurance and Protection Planning

Question 1

A client wants pure death benefit protection for a set number of years at the lowest cost. Which type of life insurance is most appropriate?

Accepted Answer

Term life insurance

Answer

Term life insurance provides a death benefit for a specified period and has the lowest premiums because it has no cash value component.

Question 2

Which of the following best describes the underwriting process in insurance?

Accepted Answer

Evaluating applicants to determine insurability and premium rates

Answer

Underwriting is the process insurers use to assess risk, determine eligibility, and set appropriate premium rates for applicants.

Question 3

A client has a $1,000 deductible on their health insurance plan. They incur $4,500 in covered medical expenses. How much does the insurer pay (assuming 100% coverage after deductible)?

Accepted Answer

$3,500

Answer

The client pays the first $1,000 (the deductible), and the insurer covers the remaining $3,500.

Question 4

Which life insurance product builds cash value on a guaranteed basis and has fixed premiums?

Accepted Answer

Whole life

Answer

Whole life insurance offers a guaranteed cash value accumulation, fixed premiums, and a permanent death benefit.

Question 5

Disability income insurance is primarily designed to replace what percentage of a worker's pre-disability earned income?

Accepted Answer

50–70%

Answer

Most disability income policies are designed to replace 50–70% of pre-disability income to encourage return to work and remain cost-effective.

(FFC) Financial Fitness Coach Certification Practice Test

(FFC) Financial Fitness Coach Certification Practice Test

FFC Insurance and Protection Planning