What is "term life insurance"?

Term life insurance is defined as a type of life insurance that offers coverage for a specified period, also known as a term. This type of policy pays a death benefit if the insured person passes away during the term of coverage. The term can range from as short as a year to as long as thirty years.

It is specifically designed to provide financial protection to beneficiaries in the event of the insured's death within that limited timeframe, making it an affordable option for many individuals seeking life insurance. Importantly, term life insurance does not build cash value; rather, it serves a straightforward purpose: providing a death benefit to the designated beneficiaries if the insured dies while the policy is active.

While the other options mention various types and functionalities of insurance, they do not accurately define term life insurance. The focus of term life on covering a defined period and not accumulating cash value or covering expenses post-death distinguishes it as a simple yet effective financial tool for those looking for temporary coverage to protect loved ones during critical years, such as while raising children or paying off a mortgage.