Which of the following statements best describes the nature of a cash value loan?
A) It is a financial transaction in which the insurer loans the money and attaches a comparable portion of the cash value as collateral.
B) It is a financial transaction in which future growth of the cash value is suspended until the loan amount plus interest is recovered.
C) It is a financial transaction in which the cash value is reduced by the amount of the loan.
D) It is a financial transaction in which the cash value is unaffected but the face amount is reduced by the amount of the loan plus interest."
Ans: A) It is a financial transaction in which the insurer loans the money and attaches a comparable portion of the cash value as collateral.
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