Life Insurance✓ Verified · outline & fact-checked · Sep 2026Difficulty 1/5
A policy provides a constant face amount and a level premium for the entire term, such as 10, 20, or 30 years. This type of coverage is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Level term insurance keeps both the death benefit and the premium level for a stated term, such as 10, 20, or 30 years. Because the premium does not rise each year the way annual renewable term premiums do, level term is the most commonly sold term product. Decreasing term has a face amount that declines each year, typically to track a mortgage or loan balance. All term insurance provides protection only for the stated period and builds no cash value, unlike permanent coverage such as whole life.
Why the other options are wrong
- B) Decreasing term's face amount declines each year, usually to match a mortgage or loan balance, rather than remaining constant for the term.
- C) Annual renewable term premiums increase each year as the insured ages, while the face amount stays level; it is not a level-premium product.
- D) Whole life builds cash value and provides permanent coverage; level term provides protection only for a fixed number of years.
Memory hook
Level term: same premium, same benefit, fixed number of years. Set it and forget it.