Oklahoma Life Producer Practice Exam

What insurance aspect does a Family Maintenance Policy primarily aim to preserve?

1. Premium levels

2. Cash value growth

3. Coverage levels

4. Policy loans

The correct answer is: Coverage levels

A Family Maintenance Policy is designed to provide a death benefit that ensures financial stability for the family in the event of an untimely death of a breadwinner. It primarily aims to preserve coverage levels by providing a combination of term and whole life insurance features. This type of policy guarantees that a certain level of life insurance coverage will be maintained for a specified period after the insured's death, which helps sustain the family's lifestyle and financial obligations during a challenging time. By focusing on coverage levels, the policy ensures that beneficiaries are financially protected and are able to maintain their current standard of living, pay off debts, and cover basic living expenses. This feature is particularly vital for families that depend heavily on one member's income, as it provides essential support during a time of need. While premium levels, cash value growth, and policy loans are important aspects of life insurance, they do not fundamentally align with the primary objective of a Family Maintenance Policy, which is to guarantee sufficient coverage for the family.