Term, Whole Life & Term to 100

How term, whole life and term to 100 policies work and when each suits a client: level, decreasing and increasing term; renewal and conversion privileges; participating and non-participating whole life, dividend options and premium offset; limited-pay designs; cash values, policy loans and the non-forfeiture options that apply when premiums stop.

Analyze the available products3 min read6 sections

Must-know for the exam

Term pays only if death occurs during the term; it is cheapest at first, but renewal premiums rise with attained age (CISRO Curriculum, Life 2.1).
Renewal continues term coverage without evidence; conversion exchanges it for permanent coverage without evidence, before the contract's deadline, at attained-age rates.
Term to 100: level premiums, lifetime coverage, typically little or no cash value, so it costs less than whole life.
Policies must state whether they participate in surplus and any surrender, loan, paid-up or extended options (Insurance Act (BC) s. 42(2), current to 6 Oct 2026).
Policy dividends are not guaranteed. Options: cash, premium reduction, deposit at interest, paid-up additions, and term or enhanced options.
Premium offset uses dividends to pay premiums; a lower dividend scale can delay it or bring premiums back.
Despite an irrevocable designation, the insured is entitled to dividends unless the contract says otherwise (Insurance Act (BC) s. 67(1)).
Reduced paid-up keeps a smaller face for life; extended term keeps the face less loans for a limited period.
Loans and accrued interest are deducted from the death benefit and the surrender value.
Statutory reinstatement does not apply once cash value is paid or a paid-up or extended option is elected (Insurance Act (BC) s. 57(4)).

On this page · 6 sections

Traps that cost marks

Counting a reduction for a policy year that has not been completed.
Comparing only the starting premiums and forgetting the renewal increase.
Treating the cash value as a separate amount added to, or deducted from, the death benefit.
Quoting the gross cash surrender value without netting the loan and interest.
Charging every loan for the same number of years.
Crediting interest to a dividend for a year before it was paid.
Thinking dividends never raise the death benefit.
Believing that once a policy goes on premium offset, premiums can never come back.

Why it matters on the exam

Product questions ask which policy or feature fits a client: a temporary or permanent need, a tight budget, a wish for guarantees or cash values, a change in health. Expect calculations on decreasing term, loans against cash values, dividend options and non-forfeiture values.

Term insurance

Design	Death benefit	Typical use
Level term (10, 20, 30)	Constant	Income replacement, fixed debts
Decreasing term	Falls on a schedule; premium usually level	Repayment mortgage
Increasing term	Rises on a schedule	Needs that grow, such as with inflation
Yearly renewable term	Constant; premium rises every year	Very short needs; costing basis inside UL

CISRO LLQP Curriculum (May 2015; current as at 12 Oct 2026), Life component 2.1.

•Renewable: continues without evidence at the contract's renewal rates.
•

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Life Insurance · Component 2: Analyze the available products (30%)