Variable Universal Life/Universal Life Plan (VUL/ULP) Practice Exam

Question: 1 / 400

How are the policy benefits of Variable Life policies primarily determined?

Only for death or disability

Dependent on the life company's performance

Linked to the investment performance of underlying assets

The benefits of Variable Life policies are primarily determined by the investment performance of underlying assets because the death benefit and cash value of these policies are directly linked to the investments chosen by the policyholder, which can include a variety of assets like stocks, bonds, and mutual funds. As the value of these investments increases or decreases, so too does the overall value of the policy. This feature allows policyholders to potentially grow their cash value at a rate that may exceed traditional life insurance products, but it also introduces the risk associated with market fluctuations. This connection to investment performance is what distinguishes Variable Life policies from other life insurance products where benefits might be more static or guaranteed.

Get further explanation with Examzify DeepDiveBeta

Guaranteed by the insurance provider

Next Question

Report this question

Download Variable Universal Life/Universal Life Plan (VUL/ULP) Practice Exam PDF Study Guide
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy