Question

Justin is the grantor of an ILIT. When he dies, his estate needs cash for funeral costs, final medical expenses, death taxes, etc. How can the proceeds of the life insurance policy in the ILIT be made available to the executor? 1. a. The trust terms may authorize the purchase of assets from the estate, or authorize loans to the estate. b. The trust terms may only authorize the purchase of assets from the estate. c. The trust terms may only authorize loans to the estate. d. The trust terms may require that all proceeds be paid to the estate. 2. Which of the following is not a major type of insurance? a. Indexed universal life insurance. b. Whole life insurance. c. Term life insurance. d. Custodial life insurance 3. Which of the following statements about insurance and annuities is incorrect? The beneficiary of a life insurance policy is the person who receives the proceeds of the policy after the insured's death. a. b. The cash surrender value of a life insurance policy is the amount payable by the insurance company to the beneficiary. c. Term insurance does not have cash value. d. Annuities are contracts that pay income to someone during their lifetime. 4. Which of the following terms describes an insurance policy that covers the lives of two people and is payable only after both have died? a. A variable life insurance policy. b. An indexed universal life insurance policy. c. A split-dollar life insurance policy. d. A second to die life insurance policy. If a deceased person has "incidents of ownership" in a life insurance policy at the time of his or her death, the death benefits are included in the decedent's gross estate. When would the decedent not have incidents of ownership? 5.

Answer 1

Answer:1 the answer is d, 2. The answer is d, 3.The answer is C, 4. The answer is d, 5. When the policy holder does not dies within the years in which the policy was taken

Explanation:

1.Trust is a group of people which has the authority to manage a asset of the owner of the asset after the death of the owner of such asset. The trustee take over the management of the asset that is the properties of the owner after the death of the owner.

2.The major type of insurance are motor vehicle insurance, fidelity guarantee insurance, fire insurance, burglary theft or robbery insurance, Accident insurance, life insurance such as joint life insurance, whole life insurance,term insurance, Annuity insurance, indexed universal life insurance.

3.Annuity insurance : This is the insurance policy in which the insured pays a lump sum of money in form of premium to the insurance company which matures at the retirement of the insured .the insurance company makes regular payment of income to the policy holder on his retirement for a specified period or for the rest of his life depending on the agreement reached and the lump sum paid by the insured.

4.The joint life insurance is the insurance policy which can be jointly taken by two people, the insurance company pays a lump sum to the person who has not died out of the two people that take the policy if the first person out of the two person that takes the policy dies within the period in which the policy was taken with the insurance company.

5. Incident of ownership is the right given by the insurance company to the insured to change the beneficiary listed by the insured on the life insurance policy taken by the insured with the insurance company. The insured can exercise his right under this measures to change the names of the beneficiaries who will receive the benefits after the death of the insured.