H12-521_V1.0 Exam Questions and Answers

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A. Query string
B. URL
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NEW QUESTION: 2
Ken has a variable life policy and recently learned that he can borrow against its cash value to help pay
for some of the expenses he's incurring while pursuing a graduate degree. Which of the following
statements about the loan he can get is true?
A. Ken never has to repay the loan, but if he chooses not to do so, his wife, Barbie, won't get as much
when he dies.
B. Ken has been misinformed. He cannot borrow against the cash value of a variable life policy because
the cash values of these policies fluctuate constantly.
C. Since Ken is essentially borrowing his own money, the loan is interest-free.
D. Ken can borrow at most only 50% of the cash value, and only as long as he's had the policy for at least
three years.
Answer: A
Explanation:
The true statement is that Ken never has to repay the loan, but if he chooses not to do so, his
wife, Barbie, won't get as much when he dies. He can borrow up to at least 75% of the cash value, but
there is interest charged on the loan. (In essence, he's paying interest to himself, though.)


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