FIN 428 Entire Course

FIN 428 Entire Course

Entire Course Link

https://zh.scribd.com/document/340327850/Uop-Tutorial

 FIN/428 

INSURANCE FOR FINANCIAL PLANNING

 

The Latest Version A+ Study Guide

 

*************************************

FIN 428 Entire Course Link

https://uopcourses.com/category/fin-428/

*************************************

 

 

FIN 428 Week 1 Short Answer Assignment
 

Resource: Week 1 Short Answer Assignment Document.

Access the document.

Complete the questions in two to four sentences.

Click the Assignment Files tab to submit your assignment.

Week 1 Short Answer Assignment

Complete the questions below in two to four sentences.

 

 

 

Define risk. In your definition, state the relationship between risk and uncertainty.
 

 

 

 

 

 

Risk may be classified in several ways. List the principal ways in which risk may be categorized, and explain the distinguishing characteristics of each class.
 

 

 

 

 

 

List the four types of pure risk facing an individual or an organization and give an example of each.
 

 

 

 

 

 

Explain why the number of risks and the severity of losses increase over time.
 

 

 

 

 

 

Identify the two broad approaches to dealing with risk recognized by modern risk management theory.
 

 

 

 

 

 

Identify and briefly describe the six steps in the risk management process.
 

 

 

 

 

 

What is the relationship between risk management and insurance management? In your answer, you should demonstrate an understanding of the difference between the two fields.
 

 

 

 

 

 

Distinguish among traditional risk management, financial risk management, and enterprise risk management.
 

 

 

 

 

 

List and explain each of the desirable elements of an insurable risk.
 

 

 

 

 

 

Explain the dual application of the law of large numbers as it pertains to the operation of insurance.
 

 

 

 

 
 

 

FIN 428 Week 1 Risk Essay
 

Write a 700- to 1,050-word essay answering the following questions:

 

 

 

Evaluate the risks you face as an individual.
 

 

Explain which of these risks you elected to retain and which you have transferred.
 

 

Propose how insurance companies could help you mitigate risk.
 

 

Format your paper consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document

 

 
 

 

FIN 428 Week 2 Learning Team Charter
 

Overview

In this course, your team will work together to complete a few assignments. This chartering assignment is designed to help you apply your project management skills to understand the scope of your project, then break the project into goals, tasks, responsibilities, resources, and milestones. The assignment also asks you to discuss and answer some questions that will lay the foundation for developing your project.

Beyond the Standard Charter

You will notice that this chartering process goes beyond your standard University of Phoenix Charter by helping your team create a project plan for team success by providing you with opportunities to define your deliverables, recognize the connections between the deliverables and other classroom activities, determine your timelines and milestones, identify each team member’s expected contribution, and answer questions that lay the foundation for building your projects.

Putting “I” in “Team”

Important to note is the section for defining learning team expectations related to participation, collaboration, communication, team contributions, assignment deadlines, and other considerations. Please take the time to discuss and document how your team will address each area and any challenges that may arise.  It is important to understand that we are “Putting ‘I’ in ‘Team'”. In short, we will recognize and reward individuals according to their contributions to team output, not according to their team membership. This means that individual grades may be different from the team grade depending on each individual’s contribution to each team deliverable.

Completing this Assignment

To complete this assignment, perform the following:

 

 

 

Review the Charter and Project plan.
 

 

Review the weekly Learning Team deliverables.
 

 

Complete the provided Learning Team Charter and Project Plan, including the following: team member contact information, project by week, learning team expectations, and team discussion questions.
 

 

Click the Assignment Files tab to submit your assignment.

 

 
 

 

 
 

 

FIN 428 Week 2 Quiz
 

 

 

 

 

Correct answerquestion1
 

 

Although insurance may be defined in various ways, the two fundamental characteristics of the insurance mechanism are

premiums and policies.

combination and sharing.

loss prevention and transfer.

transfer and sharing.

 

 

 

 

 

Correct answerquestion2
 

 

The term hazard refers to

the same thing as the term peril.

a condition that increases the chance of loss.

the same thing as probability of loss.

uncertainty regarding loss.

 

 

 

Correct answerquestion3
 

 

From the viewpoint of society and the economy, the most desirable means of dealing with risk is

loss prevention.

transfer.

sharing.

retention.

 

 

 

Correct answerquestion4
 

 

Adverse selection is a term used to describe

the tendency of the poorer than average risks to seek insurance to a greater extent than do the better than average risks.

an underwriting error on the part of an insurance company.

the choice of the wrong insurance to fit a specific need.

a loss situation in which the chance of loss cannot be determined.

 

 

 

Correct answerquestion5
 

 

Pure risk is characterized by

a chance of loss or no loss only.

a chance of loss and a chance of gain.

a chance of gain and a chance of gain.

the chance of gain or no loss only.

 

 

 

Correct answerquestion6
 

 

The definition of risk suggested in the text views risk as

subjective uncertainty.

a state of mind.

a condition of the real world.

an opportunity for gain or loss.

 

 

 

Correct answerquestion7
 

 

Financial risk management encompasses management of

credit risk, market risk, and liquidity risk

pure risk, speculative risk, and strategic risk

operational risk, strategic risk, and credit risk

compliance risk, credit risk, and strategic risk

 

 

 

Correct answerquestion8
 

 

The distinction between fundamental and particular risks is important because

particular risk policies only allow for partial coverage, whereas fundamental risk policies allow full coverage.

whether a risk is fundamental or particular may determine how society will deal with it.

fundamental risks are a source of gain to society.

normally only particular risks are insurable.

 

 

 

Correct answerquestion9
 

 

The term enterprise risk management refers to

management of risks for profit-making organizations.

management of financial risks.

integrated management of a firm’s pure and speculative risks.

management of risks related to derivatives and futures.

 

 

 

Correct answerquestion10
 

 

From the viewpoint of society and the economy, the most desirable means of dealing with risk is

sharing.

transfer.

loss prevention.

retention.

 

 

 

Correct answerquestion11
 

 

Pure risk is characterized by

a chance of loss and a chance of gain.

a chance of loss or no loss only.

a chance of gain and a chance of gain.

the chance of gain or no loss only.

 

 

 

Correct answerquestion12
 

 

The term hazard refers to

a condition that increases the chance of loss.

the same thing as the term peril.

uncertainty regarding loss.

the same thing as probability of loss.

 

 

 

Correct answerquestion13
 

 

The four elements of an insurable risk

include the requirement of economic feasibility.

must be present or the exposure cannot be insured.

are desirable, but some insurable risks do not possess them.

require that the probability of loss be known.

 

 

 

Correct answerquestion14
 

 

According to the law of large numbers, as the number of exposure units is increased

the chance or probability of loss increases.

the accuracy of predictions should be better.

the chance of loss declines.

the accuracy of predictions should remain about the same.

 

 

 

Correct answerquestion15
 

 

The risk that a firm’s IT systems will fail is an example of

strategic risk.

compliance risk.

credit risk.

operational risk.

 

 

 

Correct answerquestion16
 

 

The possibility of loss resulting from a flood is an example of

a static fundamental risk.

a dynamic particular risk.

a static particular risk.

a dynamic fundamental risk.

 

 

 

Correct answerquestion17
 

 

Risk management contributes to organization profit

by reducing the organization’s operating effectiveness.

by reducing organization’s operating costs with staff reductions.

by allowing the organization to engage in certain speculative risks.

by reducing the cost of losses.

 

 

 

Correct answerquestion18
 

 

The risk that a firm’s IT systems will fail is an example of

compliance risk.

operational risk.

credit risk.

strategic risk.

 

 

 

Correct answerquestion19
 

 

The distinction between fundamental and particular risks is important because

fundamental risks are a source of gain to society.

normally only particular risks are insurable.

particular risk policies only allow for partial coverage, whereas fundamental risk policies allow full coverage.

whether a risk is fundamental or particular may determine how society will deal with it.

 

 

 

Correct answerquestion20
 

 

The possibility of loss resulting from a flood is an example of

a static fundamental risk.

a dynamic particular risk.

a dynamic fundamental risk.

a static particular risk.

 

 

 

Correct answerquestion21
 

 

Risk management contributes to organization profit

by reducing organization’s operating costs with staff reductions.

by reducing the cost of losses.

by allowing the organization to engage in certain speculative risks.

by reducing the organization’s operating effectiveness.

 

 

 

Correct answerquestion22
 

 

There are two basic approaches to the interpretation of probability.  In insurance we are primarily concerned with

the subjective interpretation.

the relative frequency interpretation.

the a priori interpretation.

the Bayesian interpretation.

 

 

 

Correct answerquestion23
 

 

Financial risk management encompasses management of

operational risk, strategic risk, and credit risk

pure risk, speculative risk, and strategic risk

credit risk, market risk, and liquidity risk

compliance risk, credit risk, and strategic risk

 

 

 

Correct answerquestion24
 

 

The four elements of an insurable risk

are desirable, but some insurable risks do not possess them.

include the requirement of economic feasibility.

require that the probability of loss be known.

must be present or the exposure cannot be insured.

 

 

 

Correct answerquestion25
 

 

Although insurance may be defined in various ways, the two fundamental characteristics of the insurance mechanism are

transfer and sharing.

premiums and policies.

combination and sharing.

loss prevention and transfer.

 

 

 

Correct answerquestion26
 

 

The definition of risk suggested in the text views risk as

subjective uncertainty.

an opportunity for gain or loss.

a state of mind.

a condition of the real world.

 

 

 

Correct answerquestion27
 

 

There are two basic approaches to the interpretation of probability.  In insurance we are primarily concerned with

the relative frequency interpretation.

the Bayesian interpretation.

the subjective interpretation.

the a priori interpretation.

 

 

 

Correct answerquestion28
 

 

The term enterprise risk management refers to

management of risks related to derivatives and futures.

management of risks for profit-making organizations.

management of financial risks.

integrated management of a firm’s pure and speculative risks.

 

 

 

Correct answerquestion29
 

 

According to the law of large numbers, as the number of exposure units is increased

the accuracy of predictions should remain about the same.

the chance of loss declines.

the accuracy of predictions should be better.

the chance or probability of loss increases.

 

 

 

Correct answerquestion30
 

 

Adverse selection is a term used to describe

an underwriting error on the part of an insurance company.

a loss situation in which the chance of loss cannot be determined.

the choice of the wrong insurance to fit a specific need.

the tendency of the poorer than average risks to seek insurance to a greater extent than do the better than average risks.

 

 

 
 

 

FIN 428 Week 2 Insurance Viewpoints
 

Define insurance from the viewpoint of the individual and of society.

Write a 30- to 45-word response for each of the following questions:

 

 

 

Identify and explain the two essential features in the operation of insurance.
 

 

Explain how the law of large numbers supports the operation of the insurance mechanism.
 

 

Identify and explain the desirable elements of an insurable risk.
 

 

Explain what is meant by adverse selection and why it is a problem for insurers.
 

 

Explain the economic contributions of insurance.
 

 

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 
 

 

FIN 428 Week 2 Risk Management Elements & Techniques
 

Write a 700- to 1,050-word paper in which you explain the elements of the risk management process. Provide examples of the primary risk management techniques.

Format your paper consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 
 

 

FIN 428 Week 3 Learning Team: Life Insurance Analysis
 

Resources: Universal Sample Policy, Universal Life Worksheet, Whole Life Sample Policy, Whole Life Worksheet

Read the following sample life insurance policies:

 

 

 

Universal Life
 

 

Whole Life
 

 

Complete the sections in the worksheets for each sample policy after collaborating as a team.

Click the Assignment Files tab to submit your assignment.

Note. Grades are awarded based upon individual contributions to the Learning Team assignment. Each Learning Team member receives a grade based upon his/her contributions to the team assignment. Not all students may receive the same grade for the team assignment.

 

 
 

 

FIN 428 Week 3 Quiz
 

 

 

 

Correct answerquestion1
 

 

Group life insurance premiums paid by an employer are deductible by the employer and nontaxable to the employee

when included as a part of a pension plan.

up to 10% of the employee’s salary.

for up to $50,000 in group permanent life insurance.

for up to $50,000 in term life insurance.

 

 

 

Correct answerquestion2
 

 

Mr. Jones dies leaving a $100,000 life insurance policy to his wife. The wife elects to take the $100,000 over a ten year period and receives $11,130 per year.  What part of this payment is taxable as income to the wife?

Only the $100,000, which may be spread over the ten year period during which it is received

$11,130 per year

$1,130 per year

None of it

 

 

 

Correct answerquestion3
 

 

The least impressive feature cited in support of life insurance as an investment is

the compulsion it entails.

the favorable tax treatment.

you don’t have to die to collect.

the safety of principal.

 

 

 

Correct answerquestion4
 

 

The normal length of the suicide exclusion in life insurance policies is

one month from the date of issue.

six months from the date of issue.

five years from date of issue.

two years from date of issue.

 

 

 

Correct answerquestion5
 

 

The three primary elements in life insurance ratemaking are

mortality, expenses, and profits.

costs, profits and taxes.

mortality, loading, and expenses.

interest, mortality, and loading.

 

 

 

Correct answerquestion6
 

 

The specific requirements regarding evidence of insurability imposed on the insured under the reinstatement clause are

intended to avoid a loss of investment income.

required by the changing investment income over time.

necessary to prevent adverse selection.

designed to offset the cost of reissuing the policy.

 

 

 

Correct answerquestion7
 

 

The cash value in a whole life insurance policy

increases until it meets the face of the contract at the end of the policy period.

lowers because the premium paid in the early years is less than the cost of protection.

is similar in value as compared to a term insurance policy.

raises or lowers depending on its fair market value at the end of the policy period.

 

 

 

Correct answerquestion8
 

 

Life insurance contracts receive favorable tax treatment in that

in computing taxable gain, the insured may deduct all premiums paid, including the element that paid for protection.

the investment earnings on the cash value of insurance policies are not considered a taxable gain.

although proceeds to a beneficiary are usually taxable as income, it is at a reduced rate.

the investment earnings on the cash value are only taxed during the period of accumulation.

 

 

 

Correct answerquestion9
 

 

The rate of return on the investment element in cash value life insurance policies

is guaranteed in the policy to always be a positive return.

varies widely among life insurance companies.

is typically the same among life insurance companies.

is readily apparent and relatively easy for the layperson to compute.

 

 

 

Correct answerquestion10
 

 

Mr. Jones purchased a $50,000 whole life policy with double indemnity on May 1, 2000.  On May 25, 2002, he committed suicide.  The insurer will be required to pay

only the premiums which Jones has paid to the company.

$50,000.

the company will not be required to pay anything.

$100,000.

 

 

 

Correct answerquestion11
 

 

The factor that has had the greatest influence on the growth of employee benefits has been 

employer efforts to improve employee morale.

the favorable tax treatment.

the fact that coverage is on a group basis and is therefore less expensive.

union negotiation for benefits.

 

 

 

Correct answerquestion12
 

 

Under the grace period clause used in life insurance

any premium in default will be waived if the insured should die during the period.

the policy is continued for 30 days under the extended term option.

any premium in default will be deducted from the face amount of the policy if the insured should die during the period.

the policy is continued for 60 days after a premium due is in default.

 

 

 

Correct answerquestion13
 

 

The most logical classification of the types of life insurance contracts is between

those that insure a single life and those that insure multiple lives.

those that offer pure protection and those that combine protection and savings.

those that meet Internal Revenue Code requirements and those that do not.

those that receive favorable tax treatment and those that do not.

 

 

 

Correct answerquestion14
 

 

In purchasing life insurance, the first decision that should be addressed is

the minimum interest-adjusted cost that will be considered.

whether to buy term insurance or cash value insurance.

how much life insurance is needed.

the company from which life insurance should be purchased.

 

 

 

Correct answerquestion15
 

 

Assuming the same face amount and age at issue, which of the following would have the highest cash value at the end of 10 years?

Whole life

20 pay life policy

20-year term

10-year term

 

 

 

Correct answerquestion16
 

 

Assuming the same face amounts and issue at age 35, which of the following would have the highest premium?

A 20 pay life policy

A 30 pay life policy

A whole life policy

A paid-up at age 65 whole life policy

 

 

 

Correct answerquestion17
 

 

Life insurance which provides for payment only if the insured dies within a specific time period is

ordinary life insurance.

term insurance.

whole life insurance.

limited pay life insurance.

 

 

 

Correct answerquestion18
 

 

To reinstate a policy that has lapsed, the insured must:

make one lump-sum payment to pay the entire balance owing in full.

provide tax returns for the past five years for review.

pay or reinstate any indebtedness under the policy.

pay a $500 non-refundable reinstatement fee.

 

 

 

Correct answerquestion19
 

 

Whole life insurance

may be purchased under several premium paying options.

may not be purchased under several premium paying options.

develops cash values which may not be used for retirement.

guarantees protection of the insured for a specified period.

 

 

 

Correct answerquestion20
 

 

A policy is described as mature when

all premiums due have been paid.

when the face amount is payable to the insured.

when the premium payment period has ended.

when the cash value equals the net single premium for the insured at his attained age.

 

 

 

Correct answerquestion21
 

 

Decreasing term insurance is most suited to meeting which of the following needs?

Educational funds

Final expenses

Family income

Retirement income

 

 

 

Correct answerquestion22
 

 

A misstatement of age by an applicant for life insurance

voids the policy if discovered during the contestability period.

makes the policy voidable at the option of the company if discovered during the contestability period.

has no effect on the policy unless it is discovered during the contestability period.

changes the amount of insurance to the amount that the premium paid would have purchased at the correct age.

 

 

 

Correct answerquestion23
 

 

The grace period clause

is designed to avoid unintentional lapses.

must be taken out by the insured at the time the policy is taken out or it is not applicable.

provides that any premium in default will be paid out of the existing cash values.

permits the insured to purchase insurance which he or she could not otherwise afford.

 

 

 

Correct answerquestion24
 

 

In evaluating universal life policies, the factors that should be considered in judging costs include

the expense loadings charged by the insurer.

fees associated with state-mandated benefits.

the total cost paid out in insurance claims over the last twelve months.

the insurer’s projected advertising costs based on current market share.

 

 

 

Correct answerquestion25
 

 

Group insurance is a less expensive form of protection than individual policies because

mortality experience has been better under individual policies.

commissions to agents are higher.

the insurance company performs certain administrative functions on behalf of the employer.

commissions to agents are lower.

 

 

 
 

 

FIN 428 Week 3 Signature Assignment: Life Insurance Business Purposes
 

Write a 350- to 700-word essay that addresses the following:

 

 

 

Identify the principal business uses of life insurance.
 

 

Explain the principal business uses of life insurance.
 

 

Describe two scenarios involving a business use of insurance.
 

 

Format your paper consistent with APA guidelines.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document

 

 
 

 

FIN 428 Week 4 Learning Team: Long-Term Care & COBRA Coverage Scenario Analysis
 

Complete the instructions for both scenarios:

Scenario 1: Long-Term Care Insurance Coverage

Betty Hall is a 62-year-old Army veteran in good health. She retired from the military five years ago after 30 years of service. Should Betty need care, she would likely qualify for Veterans Administration (VA) benefits to pay for the cost. However, it may take a year or longer before she receives approval for services. During that time, she would have to pay the cost of care out of her current income or by liquidating assets on an as-needed basis.

Develop an appropriate long-term care insurance plan for Betty based on needs, financial resources, policy coverage, and cost.

Write a 350- to 700-word analysis of the scenario, including the long-term care insurance plan you developed for Betty.

 

Scenario 2: COBRA Insurance Coverage

Bob Smalls is 63-year-old who lost his job due to a corporate restructuring, and his employer has told him he is COBRA eligible. Bob has no liquid savings, and is in poor health.

Consider alternatives for acquiring health coverage, including COBRA, Affordable Care Act, and Medicaid.

Write a 350- to 700-word analysis of the scenario, including an explanation of alternatives for acquiring health coverage, including COBRA, Affordable Care Act, and Medicaid.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

Note. Grades are awarded based upon individual contributions to the Learning Team assignment. Each Learning Team member receives a grade based upon his/her contributions to the team assignment. Not all students may receive the same grade for the team assignment.

 

 
 

 

FIN 428 Week 4 Quiz
 

 

 

 

Correct answerquestion1
 

 

The factor that has had the greatest influence on the growth of employee benefits has been 

the favorable tax treatment.

the fact that coverage is on a group basis and is therefore less expensive.

employer efforts to improve employee morale.

union negotiation for benefits.

 

 

 

Correct answerquestion2
 

 

In evaluating universal life policies, the factors that should be considered in judging costs include

the expense loadings charged by the insurer.

the insurer’s projected advertising costs based on current market share.

fees associated with state-mandated benefits.

the total cost paid out in insurance claims over the last twelve months.

 

 

 

Correct answerquestion3
 

 

Life insurance which provides for payment only if the insured dies within a specific time period is

term insurance.

whole life insurance.

limited pay life insurance.

ordinary life insurance.

 

 

 

Correct answerquestion4
 

 

In purchasing life insurance, the first decision that should be addressed is

the minimum interest-adjusted cost that will be considered.

the company from which life insurance should be purchased.

whether to buy term insurance or cash value insurance.

how much life insurance is needed.

 

 

 

Correct answerquestion5
 

 

The normal length of the suicide exclusion in life insurance policies is

five years from date of issue.

two years from date of issue.

six months from the date of issue.

one month from the date of issue.

 

 

 

Correct answerquestion6
 

 

The least impressive feature cited in support of life insurance as an investment is

the compulsion it entails.

the favorable tax treatment.

the safety of principal.

you don’t have to die to collect.

 

 

 

Correct answerquestion7
 

 

Group insurance is a less expensive form of protection than individual policies because

commissions to agents are lower.

the insurance company performs certain administrative functions on behalf of the employer.

commissions to agents are higher.

mortality experience has been better under individual policies.

 

 

 

Correct answerquestion8
 

 

Assuming the same face amount and age at issue, which of the following would have the highest cash value at the end of 10 years?

20 pay life policy

20-year term

10-year term

Whole life

 

 

 

Correct answerquestion9
 

 

Decreasing term insurance is most suited to meeting which of the following needs?

Educational funds

Family income

Final expenses

Retirement income

 

 

 

Correct answerquestion10
 

 

Group life insurance premiums paid by an employer are deductible by the employer and nontaxable to the employee

when included as a part of a pension plan.

for up to $50,000 in group permanent life insurance.

up to 10% of the employee’s salary.

for up to $50,000 in term life insurance.

 

 

 

Correct answerquestion11
 

 

Mr. Jones dies leaving a $100,000 life insurance policy to his wife. The wife elects to take the $100,000 over a ten year period and receives $11,130 per year.  What part of this payment is taxable as income to the wife?

Only the $100,000, which may be spread over the ten year period during which it is received

None of it

$1,130 per year

$11,130 per year

 

 

 

Correct answerquestion12
 

 

Life insurance contracts receive favorable tax treatment in that

although proceeds to a beneficiary are usually taxable as income, it is at a reduced rate.

in computing taxable gain, the insured may deduct all premiums paid, including the element that paid for protection.

the investment earnings on the cash value of insurance policies are not considered a taxable gain.

the investment earnings on the cash value are only taxed during the period of accumulation.

 

 

 

Correct answerquestion13
 

 

A misstatement of age by an applicant for life insurance

has no effect on the policy unless it is discovered during the contestability period.

makes the policy voidable at the option of the company if discovered during the contestability period.

voids the policy if discovered during the contestability period.

changes the amount of insurance to the amount that the premium paid would have purchased at the correct age.

 

 

 

Correct answerquestion14
 

 

The grace period clause

provides that any premium in default will be paid out of the existing cash values.

is designed to avoid unintentional lapses.

must be taken out by the insured at the time the policy is taken out or it is not applicable.

permits the insured to purchase insurance which he or she could not otherwise afford.

 

 

 

Correct answerquestion15
 

 

The specific requirements regarding evidence of insurability imposed on the insured under the reinstatement clause are

necessary to prevent adverse selection.

intended to avoid a loss of investment income.

required by the changing investment income over time.

designed to offset the cost of reissuing the policy.

 

 

 

Correct answerquestion16
 

 

Whole life insurance

may not be purchased under several premium paying options.

develops cash values which may not be used for retirement.

guarantees protection of the insured for a specified period.

may be purchased under several premium paying options.

 

 

 

Correct answerquestion17
 

 

The three primary elements in life insurance ratemaking are

mortality, loading, and expenses.

mortality, expenses, and profits.

interest, mortality, and loading.

costs, profits and taxes.

 

 

 

Correct answerquestion18
 

 

Assuming the same face amounts and issue at age 35, which of the following would have the highest premium?

A paid-up at age 65 whole life policy

A 30 pay life policy

A 20 pay life policy

A whole life policy

 

 

 

Correct answerquestion19
 

 

Under the grace period clause used in life insurance

the policy is continued for 30 days under the extended term option.

any premium in default will be deducted from the face amount of the policy if the insured should die during the period.

any premium in default will be waived if the insured should die during the period.

the policy is continued for 60 days after a premium due is in default.

 

 

 

Correct answerquestion20
 

 

A policy is described as mature when

when the premium payment period has ended.

when the cash value equals the net single premium for the insured at his attained age.

all premiums due have been paid.

when the face amount is payable to the insured.

 

 

 

Correct answerquestion21
 

 

The cash value in a whole life insurance policy

lowers because the premium paid in the early years is less than the cost of protection.

raises or lowers depending on its fair market value at the end of the policy period.

increases until it meets the face of the contract at the end of the policy period.

is similar in value as compared to a term insurance policy.

 

 

 

Correct answerquestion22
 

 

To reinstate a policy that has lapsed, the insured must:

provide tax returns for the past five years for review.

make one lump-sum payment to pay the entire balance owing in full.

pay or reinstate any indebtedness under the policy.

pay a $500 non-refundable reinstatement fee.

 

 

 

Correct answerquestion23
 

 

Mr. Jones purchased a $50,000 whole life policy with double indemnity on May 1, 2000.  On May 25, 2002, he committed suicide.  The insurer will be required to pay

$50,000.

the company will not be required to pay anything.

only the premiums which Jones has paid to the company.

$100,000.

 

 

 

Correct answerquestion24
 

 

The rate of return on the investment element in cash value life insurance policies

is typically the same among life insurance companies.

varies widely among life insurance companies.

is readily apparent and relatively easy for the layperson to compute.

is guaranteed in the policy to always be a positive return.

 

 

 

Correct answerquestion25
 

 

The most logical classification of the types of life insurance contracts is between

those that meet Internal Revenue Code requirements and those that do not.

those that receive favorable tax treatment and those that do not.

those that insure a single life and those that insure multiple lives.

those that offer pure protection and those that combine protection and savings.

 

 

 
 

 

FIN 428 Week 4 Income Disability Insurance Policy Worksheet
 

Resources: Income Disabilty Policy Sample, Income Disability Worksheet

Read the Income Disability Sample Insurance Policy.

 

Complete the Income Disability Insurance Policy Worksheet in 45 to 90 words per question.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

Note. “Income Disability Policy Sample” and “Income Disability Sample Insurance Policy” are the same document.

 

 
 

 

FIN 428 Week 4 Summary
 

Reflect on Week 4 Electronic Reserve Readings.

Summarize your findings in 350 to 525 words.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 
 

 

FIN 428 Week 5 Learning Team: Insurance Evaluation Scenario Analysis
 

Read the following case scenario in which you are the financial planner.

Jennifer and Brian Jones (both age 50) live in Santa Fe, New Mexico. They own a home currently valued at $300,000, with a $175,000 mortgage. They have $250,000 of homeowner’s insurance coverage. The replacement cost of the structure, however, is close to $350,000. Their auto insurance has a $100,000 liability limit. They have $100,000 in investment assets held in individual IRA accounts, consisting of mutual funds. The Jones family obtains their health insurance coverage through their employer, but dental visits and eyeglasses are not covered.

They are spending their entire income and not saving. They both work, and each earns $55,000. They both plan to retire at age 66 on their state pension fund (they are both state employees) and Social Security retirement benefits, which they believe to be adequate.

They are eligible for Social Security survivors and disability benefits and are fully insured for retirement benefits, currently available equal to $2,400 per month in today’s dollars. They have no children. Neither has any disability insurance, but Steve has $100,000 of life insurance.

They have asked you to evaluate their life, disability, liability, and homeowner’s insurance needs.

Write a comprehensive 350- to 700-word insurance evaluation in response to your client.

Explain the risks that the family has, and provide recommendations to mitigate those risks.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

Note. Grades are awarded based upon individual contributions to the Learning Team assignment. Each Learning Team member receives a grade based upon his/her contributions to the team assignment. Not all students may receive the same grade for the team assignment.

 

 
 

 

FIN 428 Week 5 Quiz
 

 

 

 

Correct answerquestion1
 

 

The definition of personal property in the Homeowners forms excludes

money and securities.

all motorized vehicles.

animals.

watercraft while away from the premises.

 

 

 

Correct answerquestion2
 

 

The medical payments coverage of the Homeowners policy agrees to pay medical expenses resulting from bodily injury to

residents of the household.

only the policy holder.

guests, regardless of the insured’s liability or lack thereof.

persons other than members of the insured’s household who reside on the premises.

 

 

 

Correct answerquestion3
 

 

The Homeowners Special Form (HO-3) provides

open-peril coverage on both the dwelling and personal property.

named peril coverage on both the dwelling and personal property.

open-peril coverage on the dwelling and named peril coverage on personal property.

open-peril coverage on personal property, and named peril coverage on the dwelling.

 

 

 

Correct answerquestion4
 

 

In most states, Uninsured Motorists coverage provides coverage

for both bodily injury and property damage caused by an uninsured motorist.

is automatically included as a part of Medical Payments coverage.

only for bodily injury caused by an uninsured motorist.

only for property damage caused by an uninsured motorist.

 

 

 

Correct answerquestion5
 

 

Mrs. Jones has a Homeowners policy.  Her dog bites the mailman while he is still about three blocks away from the premises.

Medical payments coverage applies, but not the liability coverage.

The policy will pay only if Jones is found legally liable.

The policy will pay medical costs under the medical payments coverage and will also pay under liability coverage if Jones is held legally liable.

There is no coverage under the policy.

 

 

 

Correct answerquestion6
 

 

The basic purpose of the coinsurance provision is

to reduce total losses by requiring the insured to bear a part of every loss.

to induce the insured to insure a high percentage of the value of his property.

to require the insured to purchase all of his insurance from one company.

to reduce the cost of insurance by permitting insurers to collect from the negligent party causing the loss.

 

 

 

Correct answerquestion7
 

 

Which of the following losses would be paid under the collision coverage of the Personal Auto Policy?

The car collides with a deer

Bricks fall from a truck the insured is following and hit the car

The insured misjudges a curve and rolls the car

The car is stolen and the thief collides with a bridge

 

 

 

Correct answerquestion8
 

 

The Damage to Property of Others coverage under Section II of the Homeowners policies provides limited coverage for

damage to the insureds own property.

damage to property that is owned by members of the insureds household.

intentional damage by some insureds.

damage arising out of motor vehicles.

 

 

 

Correct answerquestion9
 

 

One coverage automatically included in the Tenants Homeowners form (HO-4) that is excluded from the other forms is

the Other Structures extension.

loss assessment coverage.

coverage for credit card forgery.

building additions and alterations additional coverage.

 

 

 

Correct answerquestion10
 

 

The definition of personal property in the Homeowners forms includes

pets belonging to the insured.

motorized vehicles as long as they are not licensed.

borrowed property which is being used by an insured.

property belonging to roomers and boarders.

 

 

 

Correct answerquestion11
 

 

The type of property insurance coverage which provides a definite amount for each item insured is

unscheduled coverage.

specific or scheduled coverage.

blanket coverage.

reporting coverage.

 

 

 

Correct answerquestion12
 

 

The definition of dwelling in the Homeowners forms includes

carpets and drapes.

additions in contact with the dwelling.

window air-conditioning units.

any real property fixtures attached to the property.

 

 

 

Correct answerquestion13
 

 

Under the Personal Auto Policy, if the insured has two autos insured, one with collision and one without collision, an additionally acquired auto

is not covered for collision until it is reported to the insurer.

is covered for collision until the end of the policy period.

is covered for collision for 4 days, with a $500 deductible.

is covered for collision for 14 days.

 

 

 

Correct answerquestion14
 

 

Coverage on money under the Homeowners forms

is covered on the same basis as any other personal property.

applies only while on the insured premises.

is provided for the same perils as other property, but subject to a $200 limit which may be increased.

is limited to $100 and excludes loss by theft.

 

 

 

Correct answerquestion15
 

 

The Personal Auto Policy provides coverage under the liability section for

pleasure use of nonowned motorcycles by the named insured.

the owner of a nonowned auto being used by the named insured.

nonresidents operating the owned auto with permission.

any automobile being operated by the named insured.

 

 

 

Correct answerquestion16
 

 

An individual might purchase a monoline fire dwelling policy rather than a Homeowners form on a dwelling because

the dwelling is not owner occupied.

the monoline dwelling form will be substantially cheaper.

he or she does not need the liability coverage of the Homeowners.

the Homeowners form is not available in the state in question.

 

 

 

Correct answerquestion17
 

 

The definition of flood in the Federal Flood Insurance policy

specifically excludes mudslides.

includes overflow of inland or tidal waters and rapid accumulation of surface water from other sources.

limits the peril to the overflow of bodies of water.

includes water from sources on the insured’s own property.

 

 

 

Correct answerquestion18
 

 

The replacement cost coverage provision of the Homeowners forms applies

to the dwelling, other structures, and personal property.

to the dwelling and personal property only.

to the dwelling and other structures only.

only to the dwelling.

 

 

 

Correct answerquestion19
 

 

When a motorcycle is insured under the Miscellaneous Type Vehicles Endorsement

coverage applies to the named insured for the use of any motorcycle.

coverage applies to the named insured, resident relatives and permissive users for the insured vehicle only.

coverage applies to the named insured only and only for the insured vehicle.

coverage applies to the named insured and resident relatives for the use of any motorcycle.

 

 

 

Correct answerquestion20
 

 

In purchasing automobile insurance, which of the following coverages should be considered essential?

Uninsured motorist coverage

Liability coverage

Medical payments coverage

They are all essential coverages

 

 

 

Correct answerquestion21
 

 

The definition of uninsured motorist under the Uninsured Motorist coverage of the Personal Auto Policy excludes

an automobile being operated without liability insurance.

a hit-and-run driver.

theft.

an automobile insured by a company that becomes insolvent.

 

 

 

Correct answerquestion22
 

 

Mrs. Jones has a Homeowners Broad Form (HO-2).  The bathtub overflows and causes $800 in damage to the kitchen ceiling.

The loss is covered under this form, but would not have been covered under the Homeowners Modified Form (HO-8).

Loss of this nature are inevitable and are therefore excluded.

The loss is covered under this form and would also have been covered under the Homeowners Basic Form (HO-8).

The loss is not covered under this form but would have been covered under the Homeowners Special Form (HO-3).

 

 

 

Correct answerquestion23
 

 

Mr. Jones owns a restaurant building valued at $100,000.  He carries $50,000 coverage with an 80% coinsurance clause.  He has a fire with damage to the building of $40,000.  How much will he collect for the loss?

$40,000

Nothing, since he has violated the coinsurance clause

$25,000

$32,000

 

 

 

Correct answerquestion24
 

 

Under business interruption coverage, payment is made for the period

the period in which operations could be reasonably be resumed.

specified in the policy declarations.

the period from the date of loss to expiration of the policy.

that the business is actually interrupted.

 

 

 

Correct answerquestion25
 

 

Coverage A of the Homeowners Policy would apply to

the insured’s summer home not listed in the declarations.

a shed used to store tools and equipment.

lumber to be used to in remodeling the insured’s basement.

an unattached garage rented for private garage purposes.

 

 

 

Correct answerquestion26
 

 

The liability coverage of the Homeowners policy coverage excludes

liability assumed under contract.

business liability exposures of the insured.

a child’s vicarious liability.

a parent’s vicarious liability.

 

 

 

Correct answerquestion27
 

 

Mr. Jones is insured under a Homeowners Broad Form (HO-2).  A sudden surge of power from the city’s power plant burns out the motor on his freezer and the meat in the freezer spoils before the loss is discovered.

Loss of the meat is covered, but not the damage to the motor.

Neither the meat nor the motor is covered.

Both the meat and the motor are covered.

Damage to the motor is covered, but not the loss of the meat.

 

 

 

Correct answerquestion28
 

 

When purchasing insurance on a dwelling

Homeowners Form 8 is preferable to Homeowners Form 5.

Homeowners Form 3 is preferable to Homeowners Form 2.

Homeowners Form 6 is preferable to Homeowners Form 4.

Homeowners Forms are equally preferable to one another.

 

 

 

Correct answerquestion29
 

 

The Personal Auto Policy provides coverage under the liability section for

the employer of the named insured if such employer is sued because of the operation of the covered auto by an insured person.

nonowned snowmobiles, all-terrain vehicles, and motorcycles.

all automobiles owned by the named insured.

anyone operating the owned automobile.

 

 

 

Correct answerquestion30
 

 

To which of the following persons are medical payments excluded from coverage in a Personal Auto Policy?

Resident relatives struck by an automobile while pedestrians

The named insured while occupying a nonowned automobile

Persons struck by the owned automobile

Nonresidents while occupying the owned automobile

 

 

 

Correct answerquestion31
 

 

John Jones and his son Junior are insured under separate Personal Auto Policies, covering their respective autos, each as named insured.  Jones is using Junior’s car while his own auto is in the garage for repairs.  In case of accident

only Junior’s policy will apply.

both policies will apply on a pro-rata basis.

Junior’s policy will be primary and the father’s policy will apply on an excess basis.

only the father’s policy will apply.

 

 

 

Correct answerquestion32
 

 

The ISO Commercial Property Coverage Forms

cover neither property and liability exposures.

cover both property and liability exposures.

automatically include coverage for business interruption losses.

are designed for different property types and to provide protection against different types of loss.

 

 

 

Correct answerquestion33
 

 

In which of the following situations would the Personal Auto Policy exclude coverage under the liability section?

a resident relative borrows a truck for pleasure use.

the named insured borrows a motorhome for a vacation.

the named insured borrows a truck for business use.

a nonresident borrows the covered auto for business use.

 

 

 

Correct answerquestion34
 

 

Jones built a home in 1955, which now has a replacement cost value of $100,000 and an actual cash value of $60,000.  He has it insured for $60,000 under a Homeowners Broad Form (HO-2).  The dwelling’s roof is damaged by a windstorm.  It is determined that the roof is 50% depreciated and that the cost of replacing the roof will be $8,000.  He will collect

$4,000 minus the deductible.

$6,000 minus the deductible.

nothing, since he has violated the replacement cost provision.

$8,000 minus the deductible.

 

 

 

Correct answerquestion35
 

 

Under the Personal Auto Policy, coverage for liability arising out of the use of a nonowned auto

is not provided because of the care, custody, and control exclusion.

is primary with respect to coverage on the nonowned auto.

is excess with respect to coverage on the nonowned auto.

prorates with the coverage on the nonowned auto.

 

 

 

Correct answerquestion36
 

 

Mr. Jones is insured under a Homeowners Tenants Form (HO-4).  While he is on vacation, burglars steal his television, $300 in cash, and a $12,000 Rolex watch.

A significant part of the loss will not be covered.

The entire loss is covered, subject to the deductible.

Only the television and the wristwatch are covered.

Only the television is covered.

 

 

 

Correct answerquestion37
 

 

Personal Injury liability coverage

is available to business firms but not to individuals.

includes certain intentional torts such as libel, slander, and defamation and is available by endorsement to the Homeowners.

is essentially the same thing as bodily injury coverage.

is automatically included in the Homeowners policy.

 

 

 

Correct answerquestion38
 

 

In most states, Underinsured Motorists coverage

is usually written with limits equal to the state???s minimum financial responsibility.

is mutually exclusive with Uninsured Motorists coverage.

essentially duplicates coverage of Uninsured Motorists coverage.

is a statutory coverage required of all drivers.

 

 

 

Correct answerquestion39
 

 

Which of the following losses would be payable under the comprehensive coverage of the Personal Auto Policy?

Flood damage

Collision

Losses to vehicles with less than four wheels

Reimbursement to individuals not included in the named driver exclusion provision

 

 

 

Correct answerquestion40
 

 

The Comprehensive Homeowners Form (HO-5) provides

a higher limit on money and securities than other forms.

open-peril coverage on personal property.

a broader definition of personal property than other forms.

open-peril coverage on both the dwelling and contents.

 

 

 

Correct answerquestion41
 

 

The principal difference among the various Homeowners forms is

the definition of personal property in each form.

the property covered and perils insured against in Section I.

with respect to the liability coverage under Section II.

the definition of the dwelling in each form.

 

 

 

Correct answerquestion42
 

 

Under a surety bond, the third party to whom the bonding company is answerable for the acts of the person bonded is called the

obligee.

principal.

obligor.

surety.

 

 

 

Correct answerquestion43
 

 

The Modified Homeowners Form (HO-8) differs from the other forms with respect to

the Other Structures extension.

the requirements for the notarization of the form.

the fair market value condition.

the underwriting requirements for eligibility.

 

 

 

Correct answerquestion44
 

 

Business interruption insurance provides coverage for

loss of profits resulting from an interruption at another business.

the loss of net profit and expenses that continue during a period of interruption.

damage to stock or merchandise.

loss of profits on finished goods that are damaged or destroyed.

 

 

 

Correct answerquestion45
 

 

When the Homeowners policy is used to insure a mobile home

contents coverage does not apply.

the scope of the perils is greatly reduced.

Coverage A is combined with Coverage C.

the definition of Coverage A, Buildings, is modified to include attached fuel tanks and built in furnishings.

 

 

 
 

 

FIN 428 Week 5 Auto and Homeowner’s Insurance Policy Worksheets
 

Resources: Homeowner’s Sample Policy, Homeowner’s Worksheet, Auto Sample Policy, Auto Insurance Policy Worksheet.

Read the following sample insurance policies:

 

 

 

Homeowners
 

 

Auto
 

 

Complete the worksheets for each sample policy.

Click the Assignment Files tab to submit your assignment as a Microsoft® Word document.

 

 
 

 

 
 

 
Powered by