Question

N is a 40-year old applicant who would like to retire at age 70. He is looking to buy a life insurance policy with level premiums, permanent protection, and be paid-up at retirement. Which of these should N purchase?

a)30 Pay Life
b)Term to Age 70
c)Universal Life
d)Adjustable Life

Answer 1

N should purchase a Universal Life insurance policy.

Step-by-step explanation:

N should purchase a Universal Life insurance policy. Universal Life insurance provides permanent protection and allows the policyholder to build cash value over time. It also offers the flexibility to adjust premium payments and death benefit amounts. With a Universal Life policy, N can pay level premiums and have the policy be paid-up at retirement, which aligns with his retirement goal.

N should consider purchasing a Universal Life insurance policy. Universal Life insurance offers permanent protection while providing the policyholder with the opportunity to accumulate cash value over time. One key advantage is the flexibility it offers, allowing N to adjust premium payments and death benefit amounts to better align with his financial situation and goals. This flexibility is particularly beneficial for someone like N, who has a retirement goal. With a Universal Life policy, N can opt for level premiums and potentially have the policy paid up at retirement, providing financial security during his retirement years. The combination of permanent protection, cash value accumulation, and premium flexibility makes Universal Life insurance a suitable option for individuals looking to align their insurance needs with long-term financial goals such as retirement planning.

Answer 2

The most suitable life insurance policy for N, who wants permanent protection with level premiums that are paid up by retirement, is the 30 Pay Life insurance policy.

Step-by-step explanation:

N is looking for a life insurance policy that will provide permanent protection with level premiums and will be fully paid up by the time he retires at age 70. The best option for N is a 30 30-pay life insurance policy. This type of policy allows N to pay a fixed premium for 30 years, ensuring that the policy is fully paid by his retirement age, and it will continue to provide coverage thereafter without additional payments.

Term to Age 70 is not suitable because it only provides coverage until N reaches 70, at which point coverage would end. Universal Life and Adjustable Life policies could provide permanent protection, but the premiums may not be level, and the policy may not necessarily be paid up by the time N retires.

Life insurance choices heavily depend on an individual's financial goals, current age, desired retirement age, and the structure of insurance products available.