Which type of life insurance is designed to provide benefits only at the time of death during the policy term?

Term life insurance is specifically designed to provide a death benefit only if the insured passes away during the specified term of the policy. This type of insurance does not accumulate cash value and is generally more affordable compared to other forms of life insurance, such as whole life, universal life, or variable life insurance.

Term life insurance is often selected by individuals who wish to cover specific financial obligations, such as a mortgage or children’s education, for a set period. The key feature of this insurance is its limited duration, which means that once the term expires, the coverage ceases unless the policy is renewed or converted to a permanent policy.

In contrast, whole life insurance provides coverage for the insured's entire lifetime and includes a savings component that grows cash value over time. Universal life insurance also offers lifelong coverage, coupled with flexible premium payments and a cash value component. Variable life insurance, while it does provide a death benefit, allows policyholders to invest the cash value in various investment options, thus adding a layer of complexity and potential market risk. Understanding these distinctions highlights why term life insurance is uniquely suited to meet the needs of individuals seeking temporary coverage specifically tied to their death during the policy term.