What is one key feature of term life insurance?

Term life insurance is designed to provide coverage for a specified period of time, such as 10, 20, or 30 years. This feature is central to its function, as it allows individuals to secure life insurance protection for a timeframe that aligns with their specific financial needs, such as raising children, paying off a mortgage, or other temporary obligations. If the insured passes away during the term, the policy pays out the death benefit to the beneficiaries. If they outlive the term, the coverage expires without any payout, unless renewals or conversions to permanent insurance are an option. This characteristic distinguishes term life insurance from permanent life insurance, which is intended to provide coverage for the lifetime of the insured and typically includes a cash value component that accumulates over time. Unlike term life, permanent policies have a longer commitment to insurance coverage and often serve as tools for long-term financial planning.