What is a common characteristic of decreasing term life insurance policies?

Decreasing term life insurance policies are designed with a specific characteristic where the death benefit decreases over the duration of the policy. This type of insurance is often used to cover specific financial obligations that diminish over time, such as a mortgage or other debts. As the insured person pays down these debts, the need for the full death benefit also decreases, which is reflected in the structure of the policy.

With decreasing term insurance, the premiums typically remain level during the policy term, but the coverage amount is what decreases. This feature makes it particularly appealing for those wanting to ensure that their beneficiaries receive enough to cover outstanding debts, while also taking into account that those debts will be lower as time goes on.

The other characteristics mentioned do not apply to decreasing term life insurance. For example, premiums usually don't change, but they are not designed with cash value components like whole life policies do, nor are they typically convertible to whole life insurance. Thus, the primary and defining characteristic is the reduction in the death benefit over time, making the chosen answer accurate.