Gaston's wife died last month, leaving him a death benefit of $100,000 from her life insurance policy. Gaston, who is 60, wants to invest these funds in a safe investment that will mature when he retires at age 65 and thus provide him with added income. However, he wants to be able to easily withdraw funds at any time, if necessary. He would also like to be able to name his nephew as beneficiary.
What type of investment would best suit Gaston?

• A. An equity segregated fund.
• B. A fixed-income segregated fund.
• C. A prescribed life annuity.
• D. An accumulation annuity.

(Harry, aged 60, recently sold his business and plans to invest $100,000 in segregated equity fund contracts. He wants to minimize costs but has a family history of early death.
What maturity and death benefit guarantees would be most appropriate?)

• A. 75%/100%
• B. 100%/75%
• C. 75%/75%
• D. 100%/100%

Melissa owns a disability insurance policy from Clarity Life. She makes her premium payment on the second day of each month, but this month, she misses the payment deadline. A week passes before she realizes her oversight. She makes a frantic call to Jonathan, a Clarity Life customer service representative. Jonathan explains about notices of termination. Which of the following responses is CORRECT?

• A. Melissa's policy has a grace period and would not be cancelled until 10 days after Clarity Life mails her a notice of termination.
• B. Melissa's policy would only be cancelled 30 days after the due date of her missed premium payment.
• C. Melissa's policy has a grace period and would not be cancelled until 15 days after Clarity Life mails her a notice of termination.
• D. Melissa's policy was cancelled 24 hours after she missed her payment, and Clarity mailed her a notice of termination.

Lacy is reviewing her life insurance policy with Paul, her financial advisor, because she wants to better understand its cash value and to take advantage of tax sheltering. She purchased a $200,000 Universal Life policy 3 years ago and has minimum funded the policy on an annual basis. Lacy is used to investing and is familiar with the investment world. In addition, her universal life policy has the level protection death benefit, and she has no intention of withdrawing the deposit amount, as she wishes to benefit from the tax exemption.
Lacy is prepared to deposit a large lump sum of cash into her policy that she received from an uncle that passed away.
Before completing the deposit, what should Paul inform Lacy about?

• A. Taxation.
• B. Investment account.
• C. MTAR.
• D. Face amount.

Axel owns a $150,000 whole life insurance policy with an accumulated cash surrender value (CSV) of
$20,000. His monthly premiums are $300, due on the fifth day of each month. Axel misses his November 5 premium payment and then dies a few weeks later, on November 20.

• A. $149,700
• B. $169,700
• C. $0
• D. $150,000