Oklahoma Life Producer Practice Exam

In an adjustable life policy, what aspect cannot be adjusted by the policyholder?

1. Face amount

2. Length of protection

3. Premium

4. Interest rate

The correct answer is: Interest rate

In an adjustable life policy, the policyholder has the flexibility to modify certain aspects of their coverage, including the face amount, length of protection, and premium payments. These adjustments allow the policyholder to tailor the policy to fit their financial needs and goals throughout its term. However, the interest rate is not something that the policyholder can adjust. The interest rate is typically determined by the insurer based on their investment performance and other financial factors, and it often influences the policy's cash value and dividends if applicable. Since the interest rate is dictated by the insurance company’s policies and market conditions, the policyholder does not have control over it. Thus, in the context of an adjustable life policy, the interest rate remains a fixed element, which is why it is not adjustable by the policyholder.