36
QuizMultiple Choice

Life Insurance — Quiz

Question 36 • Financial Math

What is an advantage of the universal life insurance option?

Answer
A
It has a fixed premium with no cash value.
B
It offers a limited coverage period.
C
It requires lower premiums than the term life insurance option.
D
It accumulates cash value and has a guaranteed interest rate.

Explanation

Universal life insurance can build cash value over time, and many policies guarantee a minimum interest rate on that value. That makes “It accumulates cash value and has a guaranteed interest rate” the best answer. A limited coverage period is a feature of term life insurance, while fixed premiums with no cash value do not describe universal life.

AI-written and checked against the verified answer.

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