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American College HS330 Exam - Topic 1 Question 13 Discussion

Generally all the following statements concerning life insurance arrangements for partnership buy-sell agreements are correct EXCEPT:
B) With an entity-purchase agreement the formula used for determining the number of life insurance policies needed is N (number of partners) + 1.
A) With a cross-purchase agreement each partner purchases life insurance on the life of each of the other partners.
C) With a cross-purchase agreement the individual partners are the applicants, owners, beneficiaries and premium-payers of the policies.
D) With an entity-purchase agreement the partnership strives to maintain face amounts of coverage equal to its obligations under the agreement.

American College HS330 Exam - Topic 1 Question 13 Discussion

Actual exam question for American College's HS330 exam
Question #: 13
Topic #: 1
[All HS330 Questions]

Generally all the following statements concerning life insurance arrangements for partnership buy-sell agreements are correct EXCEPT:

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Suggested Answer: B

by Howard at May 04, 2022, 03:55 AM

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Jeniffer
8 months ago
I thought there were more complexities in these agreements.
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Carylon
9 months ago
Yup, D sounds right to me!
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Casie
9 months ago
Wait, isn't the formula for entity-purchase just N?
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Madalyn
9 months ago
Totally agree, that's how it works!
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Berry
9 months ago
Cross-purchase means each partner buys for the others.
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Peter
9 months ago
I'm a bit confused by the different cardinality options. I'll need to review my notes on entity-relationship diagrams to make sure I understand the differences between 11, 1n, n:m, and m:n.
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Lisandra
10 months ago
I think I know the answer to this, but I want to double-check my understanding. Let me walk through the exhibit and the options again to be sure.
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Terry
10 months ago
I recall similar questions about disease management, and I wonder if the case management model is the one where healthcare is actively coordinated like this.
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