Question

What is one of the disadvantages of life insurance as a financial product?

a.

High marketing and initial costs reduce the amount of cash value in earlier years of policies.

b.

Life insurance is less affected by inflation compared to other financial instruments.

c.

The guaranteed yield is usually higher than that of other financial instruments.

d.

Life insurance provides no tax advantages to policyholders.

Posted under IC38 Life Insurance Agent Exam

Answer: (a).High marketing and initial costs reduce the amount of cash value in earlier years of policies. Explanation:One of the disadvantages of life insurance as a financial product is that high marketing and other initial costs can reduce the amount of cash value accumulated in the earlier years of life insurance policies.

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Q. What is one of the disadvantages of life insurance as a financial product?
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