Using the "nonworking" spouse method, what should be the life insurance need for a family whose youngest child is 10 years old? Expert Answer 100% (1 rating) Step 1 Non-working spouse method: This method is form of insurance coverage that allows you to s View the full answer Previous question Next question The insurer may tell you, or it may ask you to submit a form reporting the death. E. Weiss Research. For example, if your gross income is $65,000, then with the easy method, your life insurance requirement is ($65,000 * 0.7) * 7 = $318,500. You may not purchase insurance once your term ends. Buying from professionally qualified representatives C. Ignoring the reputations of local agencies D. Working with a representative who will help you select the proper kind of protection within your financial boundaries E. Asking family or friends for recommendations to choose an insurance company. A. Answer . C. The mortality rate it expects among its policy holders. You may need to change your coverage amounts when this happens. Copyright 2023 StudeerSnel B.V., Keizersgracht 424, 1016 GC Amsterdam, KVK: 56829787, BTW: NL852321363B01, determine the minimum amount of life insurance you should carry, the easy method to determine how much life insurance you should carry. STEINERCOLLEGEStatementofFinancialPositionJune30,2019(amountsinthousands)\begin{array}{c} Which of the following is NOT a type of permanent life insurance? A. E. None of these is correct. TERMS OF SERVICE . Surrender charge. Which of the following provisions prevents the life insurance company from refusing to pay his beneficiaries because of his original misrepresentation? E. An insurance company will calculate the annual amounts to pay each person for an annuity. In other words, if a person's death would cause you significant financial hardship, it's an insurable interest. She may need to change her coverage as her needs change. 1. The total debts of you and your spouse include the following: mortgage, $200,000; auto loan, $16,000; credit card balance, $2,000; and personal debts of $4,000. To Buy: 1800-258-5899 (9:30 AM to 6:30 PM), For Existing Policy: 1800-103-0003/ 1800-180-0003/ 1800-891-0003, Managing Director & Chief Executive Officer. A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period. We want to help you with that. A. \qquad\text{Total net assets}&&\underline{\text{\hspace{5pt}333,940}}\\ B. Variable life C. Universal life D. Adjustable life E. Decreasing term life. C. Identified annuities to be the same as certificates of deposit. Buying from a financially strong company B. You policy will continue for one year. How much term does a non-working spouse get? A. Under this approach, the insurance purchased is based on the value of the income the insured breadwinner can expect to earn during his or her lifetime. This method is used only to calculate child care needs, not the total financial needs of the family. They have determined that their annual income is $70,000 and their net worth is now $150,000. Beneficiary. The premium so collected in advance shall only be adjusted on the due date of the premium. A. Types of Life Insurance 25. B. The companys cost of doing business. Please know the associated risks and the applicable charges, from your insurance agent or the intermediary or policy document issued by the insurance company. 39. 74. DINK stands for double income, no kids. Tim and Tammy are updating their financial plan and are concerned that they might not have enough life insurance coverage for their family, which includes two children, ages 4 and 10. Question: Problem 12-10 Using the "Nonworking" Spouse Method to Determine Life Insurance Needs [LO12-2] Tim and Allison are married and have two children, ages 16 and 17 . Single adult living alone. The various funds offered under this contract are the names of the funds and do not in any way indicate the quality of these funds, their future prospects and returns. This is a very common type of policy taken by homeowners who want to support their children financially. Using the nonworking spouse method, what should be the life Dividend policy B. Nonparticipating policy C. Mutual policy D. Participating policy E. Stock policy, 34. B. Mortality and expense risk charge. C. Tell you why her product is better than the competitors. This gives you seven years of wages at 70%. Your premium will not increase when you renew it. Premium payments are fixed with a Variable Life Policy, The beneficiaries of someone who dies by suicide will never be eligible to receive any benefits from his or her life insurance policy. The settlement option that pays the life insurance proceeds in equal periodic payments for a specified number of years after your death is called A. Lump-sum payment. What will be the surrender value of LIC policy after 5 years? Of course, it would be a tragedy were something to happen to your spouse. C. Administrative fee. insurance needs for a family whose youngest child is 5 years A. Using the DINK method, what should be your need for life insurance? She, wants to determine her insurance needs. You have to drive them to and from school, oversee homework and music practice. Firstly, spouses who work part-time or who do not work have insurability interest, which should be maximized. Your annual premium is $1,000. A. The Tax Reform Act of 1986 A. In this case, 18 years. This is a method that has you multiplying your annual gross income by 70% and then multiplying that by 7. Collect premiums for the insurance contract. Polly wants the opportunity to change the amount she pays for her annual premium through the life of her insurance policy without changing her coverage. This is a method that has you adding half of all your debts plus funeral expenses. In order to have a valid policy, the owner must: To clearly illustrate your insurable interest. Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family needs method, 30. What is their total insurance need using the DINK method? True. Limited installment payment. 101. B. 25,00,000 which will remain same throughout the Policy Term. Group life C. Limited life D. Universal life E. Variable life, 51. Whole life B. Renewable term C. Convertible term D. Decreasing term E. Multiyear level. And, lastly, the family need method is a method that has you calculating your immediate needs upon death, adding it to the ongoing needs of surviving family members, and then subtracting your available assets from it. Fixed Annuities are long-term insurance products. Accidental death benefit C. Guaranteed insurability option D. Cost-of-living protection E. Accelerated benefits, 61. Each plans to continue to work after the other one dies. Please check your entries and try again. D. The beneficiary can borrow any amount up to the total benefit. It accumulates cash value. Which of the following riders would allow her to receive cash now? The sooner a person is likely to die, the lower the premiums he or she will pay, Life expectancy for men is longer than that for women. 60. c. the charge per 100 pounds to ship goods by truck He forgot to tell them that he had a heart condition, and, as a result of that condition, he recently died. Estimate how much life insurance Tim and Allison should carry to cover Allison. 65. Whether you're married, domestic partners or simply sharing a life with someone you love, taking out a pair of affordable term life insurance policies can provide both financial security and peace of mind. A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period, 57. GST On Life Insurance 42. I feel like its a lifeline. Megan wants to purchase a life insurance policy that will allow her to invest in stock. 5EPhGD!A'b1^:x[)(2##19pH`G0v#/(5;dI(D The spouse who has to stay at home, looking after the children, cooking, and supporting the family often has a more tiresome job to do, than the working spouse. Which of the following policies should she buy? D. An annuity is more advisable for people in poor health than for those who are likely to live longer than average. 25,00,000 which will remain same throughout the Policy Term. 3 days. A. \quad\text{Bonds payable}&&\underline{\text{\hspace{10pt}99,000}}\\ Trade Logo of Canara HSBC Life Insurance Company Limited (formerly known as Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd) hereinafter referred to as "Insurer" is used under license with Canara Bank and HSBC Group Management Services Limited. E. It is permanent life insurance. E. Credit life. Estimate your total Estimate how much life insurance Tim and Allison should carry. Allison is a "nonworking" spouse who devotes all of her time to household activities. Group life C. Limited life D. Universal life E. Variable life, 50. The first method is called the easy method. B. Multiyear level term. B. The rule of 70 is a means of estimating the number of years it takes for an investment or your money to double. . Non-Working Spouse Method. However, at a minimum, you should consider the financial value of child care, house care, and other domestic services that your spouse has been taking care of at present. If you find the policy or discover paperwork that indicates a policy exists, contact the insurer. What are the stages of the General Adaptation Syndrome (GAS)? Were your family to lose that, you lose all of that labor. In most cases, the life insurance offered to the stay-at-home spouse depends on the coverage and income of the earning counterpart. It also collected $820 of Pledges Receivable that were unrestricted. Can non-working spouses qualify for a life insurance? Further, you estimate that your funeral will cost $6,000. You own a home with a mortgage of $110,000, and Collection of advance premium shall be allowed within the same financial year for the premium due in that financial year However, where the premium due in a financial year is being collected in previous financial year, the premium may be collected for a maximum period of three months in advance of the due date of the premium. Here are the features of adding a Spouse Cover to your iSelect Smart360 Term Plan: Spouse Cover With the iSelect Smart360 Term Plan. C. 10 days. Quickly and professionally. While it is wise to buy a life insurance policy to protect the income of the earning spouse, covering the non-working spouse may not seem as important. a. a way of calculating an inventory's value For example, say you have a remaining mortgage of $30,000, a credit card balance of $11,000, and a personal loan of $5,000. Headquartered at 199 Broad Street, Red Bank NJ 07701-2056 If you are a family and either you or your spouse stays home with the children, it is most likely that only the working souse has life insurance coverage because thats the case with most families in our country. Using the DINK method, what should be your need for life insurance? Whole life. Another name for a straight term policy is A. Renewable term. Bill is worried about being able to pay his premium if he is totally and permanently disabled before age 60. Most participating policies are sold by: 102. She has since died. Life insurance benefits may be used to pay off a home mortgage or other debts at the time of death. C. Your premium will not increase because your policy is renewable. Term insurance for non-working spouse in India will be of great help. Anita is a "nonworking" spouse who devotes all of her time to household activities. Life insurance is a wise purchase of all individuals. Maximum amount that can be claimed as deduction for education loan, How to File ITR for Income under 2.5 Lakh, How to Reduce Tax Liability with Term Insurance, Know the Tax Benefit on Saving for Retirement, Need for a Life Insurance for the Non-Working Spouse, Making claim settlement easy for your beneficiaries, How has the occurrence of covid-19 affected insurance in INDIA, Factors That Affect Life Insurance Premiums, Reasons for Life Insurance Claim Rejection, Unclaimed Amount Movement To-senior Citizens Welfare Fund. C. Final life payment. Variety of Fund Options and Portfolio Management Strategies, Loyalty Additions + Wealth Boosters + Return of Mortality Charges, Optional In-built covers to enhance coverage, Policy Term of 1 year or less than 1 year. Jeff and Erica have two children. This website helped me pass! A. What is the most important part of an insurance agents job? insurance needs for a family whose youngest child is 5 years Donald and Charlene are married and do not have any children. 72. B. . If you mean you want to add life insurance coverage for your new spouse on your life insurance policy, you can contact your life insurance agent or carrier and request what it would cost to add a spouse rider for life insurance coverage to your existing policy. It provides both a death benefit and a savings component. D. Your policy will have the same premium as other term policies. Your annual income is $100,000. You are the wage earner in a typical family, with $55,000 gross annual income. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. E. Proceeds left with the company. Which of the following provisions should she take action on? B. 46,800/- is calculated at the highest tax slab of 31.2%(including 4% cess) for an individual assessee on life insurance premium of Rs. Yes! IN THIS ARTICLE Disability income insurance, which complements health insurance, can replace lost income and help protect you and your family from an otherwise financially catastrophic illness or injury. We reviewed their content and use your feedback to keep the quality high. If you switch life insurance policies, you will automatically still be insurable, Annuities are most beneficial for individuals who expect to live only a short time, An investment in an annuity is the same as an investment in a certificate of deposit, Tuitionandfeesreceivable(netofdoubtfulaccountsof$12), Pledgesreceivable(netofdoubtfulaccountsof$280), Property,plan,andequipment(netofaccumulateddepreciationof$104,240), Investments(atfairvalue,costof$162,000), Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Fundamentals of Financial Management, Concise Edition. Certificates of deposit. U ^s1xRpbD#rYNrJC.aeD=U]Sik@X6G[:b4(uH%-+0A?t>vT9. Your spouse expects to continue to work after your death. All of the following are major rating agencies for insurance except A. The human-life approach is a method of calculating how much life insurance is needed for a family that is based upon their financial loss when the insured person in the family passes away. The process standard deviaton Using the "Nonworking" Spouse Method to Determine Life Insurance Needs. Use Exhibit 1-B. Estimating Your Life Insurance Requirements(continued) The "Nonworking" Spouse Method. \quad\text{With donor restrictions}&\underline{\text{\hspace{5pt}229,940}}\\ 51,84,468 which includes Guaranteed Sum Assured on Maturity, accrued Guaranteed Yearly Additions and Guaranteed Loyalty Addition. Straight life. False. You must pay interest on any loans. 43. Group life C. Limited life D. Universal life E. Variable life, 52. Life insurance companies understand that taking care of the home is invaluable and is equally important as earning an income for the household. In contrast to the biopsychosocial model, the biomedical model views health as ___________. A. Ben. After payment was received, tuition During the year, charges for tuition and fees were $244,500; scholarships were$16,300; and tuition waivers for scholastic achievement were $5,100. All guarantees are based on the continued claims paying ability of the issuing company. If we really see it through the lens, probably the Non-working Spouse, as the life insurance industry calls it, has more of the work to do without getting paid as much as its office-going counterpart. MAY LOSE VALUE, INCLUDING LOSS OF PRINCIPAL. A. Waiver of premium disability benefit B. But life insurance rates can vary dramatically among applicants, insurers and policy types. Easy method C. DINK method D. Family need E. Soccer mom 95. Has the option to select any Coverage Option, any Optional In-Built Cover and any Benefit Payout Option at the stage of getting added for coverage under the policy. A. Your annual income is $60,000. D. Her parents. Your spouse expects to continue to work after your death. The Policy will terminate after payment of this benefit. A. They have determined that their annual income is $70,000 and their net worth is now $150,000. 80. If marriage has taken place after the policy commencement date, you can add the Spouse to your policy within one year from the date of the marriage. The settlement option in which the company acts as trustee and pays interest to the beneficiary is called A. Lump-sum payment. E. No interest will accumulate for any loans related to life insurance. 27. Ag;sE2/yNNF;eF]!hiV^r^l PK ! The college received cash contributions without donor restrictions of$2,080, pledges to be collected in 2021 of $550, and cash contributions to the endowments of$335. B. Using the sample chart that follows, find the column showing the age of the nonworking spouse 2. Past performance of the investment funds do not indicate the future performance of the same. Using the nonworking spouse method, what should be the life False. Easy method B. Dual income, no kids method C. Formal calculation method D. Nonworking spouse method E. Family need method, 31. lessons in math, English, science, history, and more. 68. This is also the most thorough method. Enrolling in a course lets you earn progress by passing quizzes and exams. Fixed Insurance products and services offered through Ash Brokerage or Smallwood Associates, Ltd. Institutional support 28,500. Which of the following is NOT a factor that affects the price a company charges for a life insurance policy? E. The policy requires that you pay a specified premium each year for the rest of your life. A. Incontestability clause B. Misstatement of age provision C. Naming a beneficiary D. Policy reinstatement E. The grace period, 56. \text{Tuition and fees receivable (net of doubtful accounts of \$12)}&&\text{230}\\ In case of death of the Life Assured during the Policy Term, Sum Assured on Death basis the Coverage option opted, less cumulative monthly income(s) already paid shall be payable. Diffusion Let us complete them for you. Insurance Premium A. Waiver of premium disability benefit B. Each of you Is life insurance for married couples cheaper? Limited installment payment. This next method is for those with just one wage earner in the family. Todd plans to purchase a life insurance policy from a stock life insurance company. Your rates will vary based on your unique circumstances, just as they would if you were single. Can you buy life insurance for someone who is dying? $4,000. Try refreshing the page, or contact customer support. E. Made all annuities tax free. Which method are they using to determine their life insurance needs? 2.Guaranteed Benefits - Provided all premiums have been paid as and when due and the policy is in-force. Tax benefits/savings are subject to provisions under section 80 C, 80 CCC, 80 D, 10(10A), 10(10D) and other sections of the Income Tax Act, 1961. A process has specification limits of LSL 5 540 and USL 5 550. $343,000 C. $490,000 D. $700,000 E. $750,000, 85. A. Adjustable life B. 99. A. Who will receive the benefits from her policy? If you are new to Smallwood Wealth schedule a Wealth Curve Conversation. to work after your death. C. Policyholder. 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Also, if you try to make up some of that yourself, you lose income and income potential. Allison is a "nonworking" spouse who devotes all of her time to household activities. \text{Property, plan, and equipment (net of accumulated depreciation of \$104,240)}&&\text{281,404}\\ \text{Prepaid assets}&&\text{1,364}\\ C. Your premium will be the same for the duration of your policy. One such cover by Canara HSBC Life Insurance Company is the iSelect Smart360 Term Plan. The question is, how big are yours? How do I know if my life insurance has cash value? Which method are they using to determine their life insurance needs? Using the DINK method, what should be your need for life insurance? 3.The maturity benefit calculated for a 25 years old healthy male who has opted for Canara HSBC Life Insurance Guaranteed Savings Plan with Guaranteed Savings Option through insurers website, annual premium Rs. Insurance Need: ? Please consult your independent tax advisor for details. ht _rels/.rels ( J1!}7*"loD c2Haa-?_zwxm Cash value. 41. Student services 37,700 Having life insurance for income replacement means if you pass away, your family could have the financial support they need to maintain the lifestyle they're used to. The capital retention method is a method of determining the amount of life insurance needed by using an interest-only model to support your family. Another name for temporary life insurance is A. Tim and Allison are married and have two children, ages 3 and 6. 12-3 Your needs will also change over time, so your life insurance needs may also change over time. Judy and James have a 4-year-old child. $86,000 C. $98,000 D. $172,000 E. $217,000. D. Insurer. Under this plan option, a Monthly Survival Income shall be payable at the beginning of each month, starting from the Policy Anniversary coinciding with or following the Life Assured attaining age 60 years (last birthday) which shall continue till the end of the Policy Term or the death of the Life Assured whichever is earlier. Jeff and Erica have two children. One of the most common questions we hear is, Can my non-working spouse qualify for life insurance? The answer is yes! C. Temporary insurance. is =1.25\sigma = 1.25=1.25. old? 200 lessons. So with funeral expenses of $10,000, your life insurance requirement is: This next method is for those with just one wage earner in the family. B. Insurance Need: . 700 cartons to be stored. What is the cost of living in California? The settlement option that pays the life insurance proceeds to the beneficiary for as long as she or he lives is called A. Lump-sum payment. A. Renewable term B. Multiyear level term C. Decreasing term D. 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