Reference no: EM131646615

1. A disadvantage of using a whole life policy for saving is:

since premiums must be paid to keep the policy in force, there is the semi-compulsory nature of saving

earnings outside the policy can be greater

creditor protection is available if bankruptcy occurs

federal income tax must be paid on the yearly cash value increases

2. The preexisting condition clause in health insurance:

makes a preexisting insurance contract pay for prior medical conditions

coordinates the payment of already existing conditions among multiple policies

provides blanket coverage for preexisting conditions

eliminates coverage for conditions that existed before the effective date of the current contract