Montana State Life Insurance Practice Exam 2025 - Free Life Insurance Practice Questions and Study Guide

The cost index must be provided to prospective purchasers because it plays a crucial role in helping potential buyers assess and compare different life insurance products. The cost index is a tool designed to present the costs and benefits of a policy in a simplified manner, allowing consumers to make informed decisions about which insurance policy best meets their needs. By providing this information, insurance professionals ensure that individuals have a clear understanding of the financial implications, facilitating transparency and promoting informed purchasing.

Existing policyholders might not need this information as they are already committed to their policies and may not be in the market for new coverage. Insurance agents and company executives may have insights into cost indices, but their roles do not mandate that these indices are explicitly provided to them in the same way they are to those considering a purchase.