What is a defining feature of whole life insurance?

• A. It provides protection for life to age 100 and builds cash value.
• B. It pays only for a fixed term and has no cash value.
• C. It requires paying only after the insured dies.
• D. It ends when cash value reaches a target amount.

Answer: (A)

Whole life insurance provides permanent protection for the insured’s life and builds cash value. The coverage lasts for life (often with level premiums), and a portion of the premium goes into a cash value account that grows over time. The death benefit is paid when the insured dies, and the cash value can be borrowed against or accessed under the policy’s terms. This combination—lifelong coverage plus a cash-value buildup—is what distinguishes it from term insurance, which lasts for a fixed period and has little or no cash value. The other descriptions don’t fit because they describe term-like features, payments only after death, or termination of the policy at a cash-value target, none of which define whole life.