Which term describes contracts that offer guaranteed minimum or fixed benefits that are stated in the contract?

Which term describes contracts that offer guaranteed minimum or fixed benefits that are stated in the contract?

• A. Fixed life insurance
• B. Variable life insurance
• C. Group life insurance
• D. Solicitation of insurance

Answer: (A)

Contracts that promise a guaranteed minimum or fixed benefit as stated in the policy are described as fixed life insurance. These policies provide a guaranteed death benefit and typically level premiums, with the cash value growing at a specified, guaranteed rate. This contrasts with variable life, where the benefit and cash value depend on investment performance; group life covers a defined employer or group and may not offer the same fixed guarantees; solicitation of insurance refers to the sales process rather than a policy type.

Contracts that promise a guaranteed minimum or fixed benefit as stated in the policy are described as fixed life insurance. These policies provide a guaranteed death benefit and typically level premiums, with the cash value growing at a specified, guaranteed rate. This contrasts with variable life, where the benefit and cash value depend on investment performance; group life covers a defined employer or group and may not offer the same fixed guarantees; solicitation of insurance refers to the sales process rather than a policy type.