Cash value is not guaranteed
Minimum death benefit is guaranteed in variable insurance plans
Where to keep the money invested is the decision of the policyholder
Flexible premium payments are allowed in such policies
Answer is Right!
Answer is Wrong!
The correct answer is: A. Cash value is not guaranteed.
In a variable insurance plan, the policyholder chooses how to invest the money in the policy. This means that the cash value of the policy is not guaranteed, as it will fluctuate based on the performance of the investments. In contrast, in a fixed insurance plan, the cash value is guaranteed and will not fluctuate.
Here is a brief explanation of each option:
- Option A: Cash value is not guaranteed. This is the correct answer, as the cash value of a variable insurance plan is not guaranteed. It will fluctuate based on the performance of the investments.
- Option B: Minimum death benefit is guaranteed in variable insurance plans. This is true. In a variable insurance plan, the minimum death benefit is guaranteed. This means that even if the investments in the policy lose money, the policyholder will still receive at least the minimum death benefit.
- Option C: Where to keep the money invested is the decision of the policyholder. This is true. In a variable insurance plan, the policyholder chooses how to invest the money in the policy. This means that the policyholder can choose to invest in stocks, bonds, or other investments.
- Option D: Flexible premium payments are allowed in such policies. This is true. In a variable insurance plan, the policyholder can choose to make flexible premium payments. This means that the policyholder can choose to make small or large payments, or even no payments at all.