CARD Q043
A life policy has a $240,000 death benefit and $18,000 of outstanding policy debt, including interest. Assuming no other adjustments, what is paid at death?
- $258,000
- $222,000
- $240,000
- $18,000
$222,000
Outstanding policy debt is deducted from the benefit: $240,000 − $18,000 = $222,000.
Why each choice is right or wrong
A. $258,000
Incorrect. The debt is subtracted, not added.
B. $222,000
Correct. Outstanding policy debt is deducted from the benefit: $240,000 − $18,000 = $222,000.
C. $240,000
Incorrect. Outstanding debt reduces the stated proceeds under the scenario.
D. $18,000
Incorrect. The debt alone is not the death benefit payable.
Review the related terms
Use these lessons to revisit the concepts and try additional practice questions.