Florida Insurance Licensing 2025 – 400 Free Practice Questions to Pass the Exam

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What type of insurance does whole life insurance provide?

Permanent coverage with a cash value component and level premiums

Whole life insurance provides permanent coverage, which means that the policy remains in effect for the insured's entire life, as long as premiums are paid. One of the key characteristics of whole life insurance is the cash value component, which accumulates over time. This cash value grows at a guaranteed rate and can be borrowed against or withdrawn by the policyholder, providing a savings element in addition to the death benefit.

The level premiums feature signifies that the policyholder pays the same premium amount throughout the life of the policy, making financial planning more predictable. Because whole life insurance combines both a death benefit and cash value growth, it serves as both an insurance product and a financial asset. This dual purpose enhances its appeal, particularly for individuals looking for long-term financial security and wealth accumulation in addition to providing for their beneficiaries.

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Coverage that lasts only for a specified term without cash value

An insurance policy that is limited to accidental death

A policy that covers only funeral expenses

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