Life Insurance for Death Benefits

B

The correct answer to this question is option B: Term life insurance.

Term life insurance is a type of insurance policy that provides death benefit coverage for a specified period, usually ranging from one to thirty years. The coverage amount and premiums paid remain the same throughout the term of the policy.

Term life insurance does not accumulate any cash value over time, which means that the policyholder does not receive any money back at the end of the term. The policy only pays out a death benefit if the insured person dies during the term of the policy.

Other types of insurance policies that are commonly confused with term life insurance include straight term policies and decreasing term policies.

Straight term policies are another term for term life insurance, and both terms can be used interchangeably. The coverage and premiums remain the same throughout the policy's term, and no cash value accumulates over time.

Decreasing term policies, on the other hand, provide a decreasing death benefit amount over time. These policies are often used to cover mortgage or other debts that are expected to decrease over time. The premiums paid for decreasing term policies also decrease over time.

Finally, renewability refers to the option to renew an insurance policy at the end of its term. Some term life insurance policies offer the option to renew the policy for an additional term, often with an increased premium. However, renewability does not affect the fact that term life insurance policies do not accumulate cash value and only provide death benefit coverage for a specified period.