SIE Exam Question 1050: Answer and Explanation

Question: 1050

Which of the following refers to an insured exchanging an existing life insurance policy for a new policy without paying tax on the investment gains earned on the original policy?

• A. 179 exchange
• B. 529 exchange
• C. 1031 exchange
• D. 1035 exchange

Correct Answer: D

Explanation:

A 1035 exchange refers to an insured exchanging an existing life insurance policy for a new policy without paying tax on the investment gains earned on the original policy.