Which One of the Following Statements About Universal Life Insurance

question 37

Multiple Choice

Which one of the following statements about universal life insurance is not true?

• A) Cash contributions, net of term premiums, are invested at market rates.
• B) The policyholder may vary the level of insurance coverage.
• C) The policy does not qualify for the special federal tax exclusion of income built up inside the contract.
• D) The amount of policyholder contribution each year is the difference between the contributions and the price of a one-year term policy.

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Definitions:

Eminent Domain

The power of the government to take private property for public use, with compensation to the owner.

Privately Owned Land

Land that is owned by individuals or entities other than the government, with the owners maintaining control and rights over the property.

Single-family Dwelling Ordinance

A municipal regulation which specifies zoning laws and construction standards primarily for houses intended for single families.

Judicial Review

The power of courts to assess the legality of actions taken by the executive and legislative branches or evaluate the constitutionality of laws.