New Jersey Life Insurance Exam Practice Question
Which of the following is a PRIMARY feature of endowment policies?
Correct Answer: C
Rationale: Endowment policies are primarily designed to build cash values quickly, allowing policyholders to receive a lump sum after a specified term or upon death.
Option A is incorrect as endowment policies typically accumulate cash value at a moderate pace, not slowly.
Option B is misleading; endowment policies often have higher premiums than traditional life insurance due to their cash value component and payout structure.
Option D is inaccurate because endowment policies pay the specified sum upon death or at the end of the term, not exclusively if death occurs before the term ends.
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