A Life Insurance Policyowner May No Longer Need Life Insurance

question 18

Multiple Choice

A life insurance policyowner may no longer need life insurance.Such a policyowner may sell the policy to a third party for more than its cash value.The purchaser becomes the new beneficiary and is responsible for subsequent premium payments.Such a financial transaction is called a(n)

• A)collateral assignment.
• B)accelerated death benefits rider.
• C)absolute assignment.
• D)life settlement.

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Definitions:

Consulting Services

Specialized professional services offered by experts to help organizations improve their performance, solve problems, or gain external advice.

Assets

Resources owned by a company that have economic value and can contribute to future income.

General Ledger

The primary accounting record of a company that uses double-entry bookkeeping, containing all the financial accounts and transactions of a business.

Accounts

Records summarizing all transactions related to a particular item over a period.