Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 1/5
In a level term life insurance policy, the death benefit and the premium:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
A level term policy guarantees a level death benefit and a level premium for the entire term period, such as 10, 20, or 30 years. Because mortality risk rises with age, the level premium is higher in the early years than an annual renewable term premium, but it does not increase during the term. At the end of the term, the policy may be renewable or convertible under the contract, or it may simply expire, depending on the policy's provisions.
Why the other options are wrong
- B) Decreasing term is the type whose coverage declines; level term keeps both elements constant.
- C) Automatic inflation adjustment is a rider or optional feature, not a level term characteristic.
- D) Level term is often renewable or convertible, so the statement that it can never be renewed is incorrect.
Memory hook
Level term = level amount and level premium, locked in for the whole term.