Washington Life Producer Practice Exam

What is a life insurance policy called that is written on one contract for two individuals, payable upon the first death?

1. Joint life insurance

2. Term life insurance

3. Universal life insurance

4. Whole life insurance

The correct answer is: Joint life insurance

A life insurance policy that is written on one contract for two individuals, payable upon the first death, is referred to as joint life insurance. This type of policy is specifically designed to provide coverage for two people, typically spouses or partners, and pays out upon the death of the first insured individual. As a result, it can be a useful financial planning tool for couples, ensuring that the surviving partner has financial support after the loss of the first to pass away. In contrast, other types of life insurance mentioned in the options function differently. Term life insurance provides coverage for a specified period and pays out only if the insured dies during that term. Universal life insurance is a type of permanent insurance that combines a death benefit with a cash value component, and it offers flexible premiums. Whole life insurance, another form of permanent life insurance, provides a death benefit as well as a cash value that grows at a guaranteed rate. However, these other policies do not specifically cater to the situation of two individuals under a single contract that pays out on the first death, making joint life insurance the correct answer.