If a consumer would like to make sure that survivors are left with a paid-off car, boat, and home, at an affordable price, what type of policy should he or she consider acquiring at the time each one of those items were purchased? A. Variable life insuranceB. Whole life insuranceC. Credit life insuranceD. Increasing term insurance

Question

Izaiah Chang

Business

11 February, 22:35

If a consumer would like to make sure that survivors are left with a paid-off car, boat, and home, at an affordable price, what type of policy should he or she consider acquiring at the time each one of those items were purchased? A. Variable life insuranceB. Whole life insuranceC. Credit life insuranceD. Increasing term insurance

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Amelia Yu · Answer 1

Answer: C - Credit life insurance

Explanation: Credit life insurance is a specialised type of life insurance policy that intends to pay off all policy holders outstanding debts upon the death of the policy holder.

The face value of a credit life insurance policy decreases proportionately with the outstanding loan amount as the loan is paid off over time. Due to its specific nature, credit life insurance policy have less stringent underwriting requirements.

Debts that can be paid off are car loan, mortgage loan, student loan etc.