What is a key feature of term life insurance compared to whole life insurance?

Term life insurance is characterized primarily by its coverage for a specified period of time, making it distinct from whole life insurance. Term life provides a death benefit to beneficiaries if the insured passes away within the chosen term, which can range from a few years to several decades. This feature allows individuals to select a policy that meets their short-term needs, such as covering debts or providing for dependents until they reach financial independence.

In contrast, whole life insurance offers lifelong coverage, which means that the policy remains in force as long as premiums are paid, with a death benefit that does not expire. It also includes a cash value component that accumulates over time, which is not a benefit of term life insurance. Therefore, the notion of higher premiums is more applicable to whole life policies due to their additional features, such as the cash value accumulation and the permanent nature of the coverage.

The correct answer underscores the fundamental difference between term and whole life insurance, helping individuals make informed choices based on their financial goals and needs.