What characterizes permanent life insurance?

Permanent life insurance is characterized by its provision of lifetime coverage and the accumulation of cash value over time. Unlike term insurance, which offers protection for a specified period without any cash value component, permanent life insurance remains in force for the insured's entire lifetime, as long as premiums are paid.

The cash value aspect is significant because it allows policyholders to build savings within the policy. This cash value can be accessed through loans or withdrawals, providing liquidity and financial flexibility. The growth of cash value is typically tax-deferred, offering additional financial advantages to policyholders.

By contrast, alternatives like term insurance focus solely on providing a death benefit without any financial accumulation, which is why the other options do not fit the definition of permanent life insurance.