Free CSI AFP-Exam-1 Exam Dumps Questions & Answers

Demario, age 28, has just started his own law firm. He met with his financial planner, Ivy, and she told him that he needs insurance, but Ivy did not specify which type. Demario is single and owns his own home. At this point in his career, his greatest asset is his human capital. Which type of insurance should Ivy have specified to purchase in order for Demario to best protect this asset?

• A.  Critical Illness.
• B.  Term Life.
• C.  Disability.
• D.  Extended health care.

Dianna is visiting with Karen, her Financial Planner, and is excited to report that she has just bought her dream home. She has also let Karen know she Is meeting with an insurance representative to purchase a whole life insurance to cover her 20-year mortgage. Why might Karen suggest Dianna consider term life insurance instead?

• A.  The cost of premiums is lower than whole life.
• B.  It is better suited for long term insurance needs.
• C.  The term policy has a cash value, which can be borrowed against.
• D.  The client's health may deteriorate as she gets older.

A business owner completes an estate freeze, taking back preferred shares with a fixed redemption value while children receive common shares. What is a primary risk of this strategy for the owner?

• A.  No future growth can occur in the corporation.
• B.  The freeze automatically eliminates all tax at death.
• C.  The children can never benefit from future growth.
• D.  The owner's retained preferred shares may not provide adequate income or inflation protection.

Which assets will flow through an estate?

• A.  Assets which the owners are registered as joint tenants with rights of survivorship.
• B.  Business assets covered by a buy-sell agreement.
• C.  Assets held in an inter vivos trust.
• D.  Assets which the owners are registered as tenancy in common.

Edward's client is updating his will and is concerned what will happen to his and his wife's estates should they die within a short time of each other. Which clause in the will should Edward recommend the couple discuss with their lawyer?

• A.  Life interest.
• B.  Survivorship.
• C.  Successor.
• D.  Conversion.