Term Life Insurance

It pays a death benefit that remains the same throughout the term and charges a level premium for that period — Level term insurance provides a death benefit that stays constant for the stated term (for example, a $250,000 20-year level term policy pays $250,000 whether death occurs in year 1 or year 19) and is priced with a level premium for the entire term period. It is pure death protection with no cash value. Decreasing term, by contrast, has a benefit that declines over time.

National insurance concept

The face amount, payable only if the insured dies during the policy's stated term — A term policy provides temporary protection: the insurer agrees to pay the stated face amount (death benefit) only if the insured dies within the specified policy period or term. The policy contains no cash value and no permanent reserve, so the insurer's limit of liability is exactly the face amount, and that liability exists only during the term. Once the term expires without conversion or renewal, the coverage and the insurer's liability end. This distinguishes term coverage from permanent policies, where liability continues for life and a cash value component exists.

National insurance concept