Oklahoma Life Producer Practice Exam

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Study for the Oklahoma Life Producer Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

Practice this question and more.

What is a common reason for policyholders to choose a Universal Life policy?

Lower premiums than Term Life insurance
The potential for cash value accumulation
The guarantee of a death benefit payout
No medical exam requirements

The correct answer is: The potential for cash value accumulation

A key reason policyholders often select a Universal Life policy is because of the potential for cash value accumulation. Universal Life insurance is designed with a flexible premium structure that allows policyholders to adjust the amount of their premiums and the frequency of payments. A portion of the premium goes into a cash value account that can grow over time, often at a variable interest rate, depending on the insurer's portfolio performance. This cash value can be accessed during the policyholder's lifetime through loans or withdrawals, making it an attractive option for those looking for both life insurance coverage and a savings component that can provide financial liquidity in the future. This dual nature of providing a death benefit while also offering a means for cash value growth sets Universal Life apart from some other types of life insurance policies that may not have this feature.