Utah Life Producer Practice Exam

To sell variable life policies, an agent must obtain a securities license because these policies are considered both life insurance and a security due to their investment component. Variable life insurance products allow policyholders to allocate a portion of their premiums to various investment options, and the value of the policy may fluctuate based on the performance of these investments.

Because variable life insurance is linked to the market and involves investment risk, agents must comply with regulations set by the Securities and Exchange Commission (SEC) and be licensed to sell securities. This dual requirement emphasizes the need for agents not only to have a life insurance license but also a securities license to understand the complexities associated with investment products like variable life insurance. This ensures that agents can adequately inform and protect consumers when they are considering the purchase of such financial products.