Question

At age 30, an applicant wants to start an insurance program, but realizing that his insurance needs will likely change, he wants a policy that can be modified to accommodate those changes as they occur. Which of the following policies would most likely fit his needs?

1) Term life insurance
2) Whole life insurance
3) Universal life insurance
4) Variable life insurance

Answer 1

A universal life insurance policy offers the flexibility and adjustability that a 30-year-old applicant seeks, allowing modifications to premium payments, death benefits, and savings elements to meet changing insurance needs over time.

Step-by-step explanation:

A 30-year-old applicant who is looking for a life insurance policy that can be modified to accommodate changes in insurance needs would most likely benefit from a universal life insurance policy. Universal life insurance is a type of permanent life insurance that combines the protective aspects of life insurance with a savings element, which can produce a cash value. This type of policy offers flexibility in the premium payments, death benefits, and the savings element of the policy. Therefore, it can be adjusted over time to fit the insured's changing needs and circumstances. Other types of policies, such as term life insurance, whole life insurance, and variable life insurance, offer different benefits and levels of flexibility, but none offer the complete adjustability that universal life insurance provides.