What is a common characteristic of whole life insurance policies?

Whole life insurance policies are designed to provide lifelong coverage, which includes a guaranteed death benefit. This means that as long as the policyholder pays the premiums, the insurance company guarantees that a specific amount will be paid out to the beneficiaries upon the death of the insured. This characteristic is fundamental to whole life policies since they are structured to financially protect the insured’s loved ones with certainty over their lifetime.

In addition to the guaranteed death benefit, whole life insurance also accumulates cash value over time, which can be borrowed against or withdrawn, but this aspect does not relate to the characteristic being discussed here. On the other hand, whole life insurance does not require annual renewal like term life policies and does not provide temporary coverage; these aspects highlight the stability and permanence associated with whole life insurance.