Tennessee Insurance Practice Exam

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Prepare for the Tennessee Insurance Exam with engaging quizzes featuring detailed flashcards, multiple-choice questions, hints, and explanations, ensuring readiness for test day.

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K is seeking a permanent life insurance policy that provides the most protection per dollar. Which policy would be most suitable?

Simplified Issue Whole Life
Straight Life
Universal Life
Variable Life

The correct answer is: Straight Life

The most suitable policy for K, who is looking for a permanent life insurance option that provides the most protection per dollar, would indeed be the Straight Life policy. Straight Life insurance is designed to provide a guaranteed death benefit along with a cash value component that accumulates over time. It typically offers higher coverage amounts for lower premiums compared to other types of permanent life insurance. This means that for a fixed premium, the policy will yield a significant death benefit that can be beneficial for K’s needs while keeping costs manageable, thus maximizing the protection provided. In contrast, other types of policies, such as Universal Life and Variable Life, often come with more flexible premium structures and investments that can affect the cost of insurance over time, potentially leading to higher long-term costs. Simplified Issue Whole Life may provide coverage without extensive medical underwriting, but it usually comes with higher premiums relative to the coverage amount compared to Straight Life, making it less efficient in terms of protection per dollar spent.