A Variable Life policy includes which premium structure?

Study for the Texas General Lines – Life, Accident, and Health Insurance exam. Engage with questions, hints, and explanations. Get exam ready!

Multiple Choice

A Variable Life policy includes which premium structure?

Explanation:
Variable Life uses a fixed, level premium structure. The policy requires payments of the same amount each period, while the cash value and the death benefit can vary based on how the funds in the separate accounts perform. Flexible premiums are a feature of Universal Life or Variable Universal Life, not traditional Variable Life. Increasing premiums over time aren’t standard for Variable Life, and no premium would leave the policy unpaid and at risk of lapse. Therefore, the premium remains fixed and level.

Variable Life uses a fixed, level premium structure. The policy requires payments of the same amount each period, while the cash value and the death benefit can vary based on how the funds in the separate accounts perform. Flexible premiums are a feature of Universal Life or Variable Universal Life, not traditional Variable Life. Increasing premiums over time aren’t standard for Variable Life, and no premium would leave the policy unpaid and at risk of lapse. Therefore, the premium remains fixed and level.

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