Which of the following describes term life insurance?

Term life insurance is characterized by coverage that lasts for a specified period. This means that the policy provides a death benefit to the beneficiaries if the insured individual passes away within that set time frame, which can range from a few years to several decades. This type of insurance is typically more affordable than permanent life insurance options, as it does not include a cash value component or the guarantees associated with lifelong policies.

The essence of term life insurance lies in its straightforward nature: because it is temporary and does not accumulate cash value, it serves primarily to provide financial protection during critical years, such as when individuals have dependents or outstanding debts. After the term expires, the coverage may end, but can often be renewed or converted to a permanent policy, depending on the terms of the original contract.