Review Questions Module 4
GROUP CARVE-OUT
A Tom may continue insurance coverage after retirement.
B Tom may continue coverage if he quits jobs.
C Tom can make voluntary contributions to the universal life insurance policy that will grow tax-deferred.
D All of the above
A Costs may increase.
B Costs may decrease.
C Both A and B
D Neither A nor B
I No plan discrimination concerns
II Current income tax deduction for premiums
III Cost increase is offset by premium deductions
A I only
B I and II only
C I and III only
D II only
A The premiums paid for the group term life insurance are deductible by the employer as an employee benefit.
B The premiums paid for the universal life insurance policy are deductible by the employer as compensation.
C Both A and B
D Neither A nor B
A $50,000
B $100,000
C $150,000
D None must be reported.
A increased
B reduced
C eliminated
D maintained at the same level
A Executive
B Employer
C Both A and B
D Neither A nor B
A. Term insurance
B. Whole life insurance
C. Universal life insurance
D. Endowment insurance
A. P.S.58 rates
B. Table 2001 rates
C. Table I rates
D. P.S.38 rates
A. $100
B. $150
C. $250
D. nothing
A. Post-retirement death benefits
B. Portability
C. Tax-deferral of employer premium payments
D. Supplemental executive retirement plan
A. The employer is fined
B. Its tax advantages may be lost
C. The plan is disqualified
D. The employees are subject to tax audit
A. $50,000
B. $75,000
C. $100,000
D. $250,000
A. additional compensation
B. bonus compensation
C. an employee benefit
D. a dividend
A. compensation
B. an employee benefit
C. a dividend
D. a charitable contribution
A. The coverage terminates
B. The coverage is portable and stays with the executive
C. The coverage reduces by 50%
D. The coverage becomes fully paid-up for the executive
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