You meet with your client, Ronaldo, for an annual review. Ronaldo purchased a life insurance policy from you several years ago when he was working in the oil industry. Ronaldo’s wife, Jasmine, is revocable beneficiary. Unfortunately, Ronaldo lost his job recently and needs to borrow some money. When Ronaldo asks you about borrowing money using his insurance policy, which of the following is the CORRECT response that you should provide to him?

a) The policy cash surrender value will be reduced by any outstanding policy loan.

b) A collateral loan will trigger policy gains which will be taxable as income.

c) Insurance policy loans are limited by the underwriting criteria of the third party lending institution.

d) Jasmine will have to give her consent before Ronaldo can take a policy loan.