Which statement is true about term insurance?

Which statement is true about term insurance?

• A. It accumulates cash value over time.
• B. It provides living benefits such as riders.
• C. It does not offer any cash value or living benefits.
• D. It does not require a premium.

Answer: (C)

Term life is designed as pure protection for a set period, and it does not build cash value. Because of that, it doesn’t provide living benefits in its basic form. Some policies can add riders that offer living benefits or options to convert to permanent coverage, but those features aren’t part of the standard term policy itself. Premiums are required to maintain coverage, and once the term ends, the policy typically ends unless you renew or convert. So, the statement that term insurance does not offer any cash value or living benefits is true.

Term life is designed as pure protection for a set period, and it does not build cash value. Because of that, it doesn’t provide living benefits in its basic form. Some policies can add riders that offer living benefits or options to convert to permanent coverage, but those features aren’t part of the standard term policy itself. Premiums are required to maintain coverage, and once the term ends, the policy typically ends unless you renew or convert. So, the statement that term insurance does not offer any cash value or living benefits is true.