Compare a $100,000 20 year endowment policy to a 20 year limited payment lfe policy which statement is?

incorrect?

1 The cash values should be about the same at the end of 20 years
2 Different premium paying periods are 20 years
3 The premiums paying periods are 20 years
4 Same death benefits would be paid during the first 20 years.


Policies


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2 Responses to Compare a $100,000 20 year endowment policy to a 20 year limited payment lfe policy which statement is?

  1. actuator says:

    Sounds like a homework question.
    Actually, I don’t think any company in the US sells 20 year endowment any more, but if a company did, the answer is:

    Statement 1 is incorrect. The endowment policy has a cash value equal to its full death benefit at the end of 20 years. The 20 year limited payment life policy has a cash value at the end of 20 years equal to the value of a fully paid-up life insurance policy (which is LESS than the full death benefit).

    Statement 2 appears to be written incorrectly. I assume it should say (in effect): "The cash values are different. The premium paying periods for both policies are 20 years." This is true.

    Statements 3 and 4 are true as written.

  2. sulaiman s says:

    Ok,this sounds ok….

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