Question 1005 of 287 · Texas Life, Accident and Health Agent Exam
In a universal life policy, the cash value is reduced each month by
Exactly one answer is correct.
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Correct answer to question 1005
- B: the cost of insurance and expense charges
Explanation
Universal life is unbundled: premium goes into the account value and monthly deductions for mortality (cost of insurance) and expenses are taken out. If the account value cannot cover these deductions, the policy can lapse.
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