In a level term insurance policy, during the policy term:
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Level term insurance provides a level, constant face amount and a level premium for a stated period, such as 10, 20, or 30 years. During the term, neither the premium nor the death benefit changes, which makes the coverage predictable and affordable. At the end of the term the policy may expire, be renewed, or be converted, and any renewed coverage is priced at the insured's then-current age. This distinguishes level term from decreasing term, where the face amount declines, and from annual renewable term, where the premium rises each year. Level term is the most common form of term insurance sold.
Why the other options are wrong
- A declining face amount with a level premium describes decreasing term insurance, such as mortgage protection, where coverage tracks the outstanding loan balance.
- A level face amount with annually increasing premiums describes annual renewable term insurance, which is repriced each year at the insured's attained age.
- Both values remain level in a level term policy; neither the face amount nor the premium decreases during the term.
Memory hook
Level term = a flat line for both coverage and price until the term ends.