PSI Life Exam Practice Test 2025 – Complete Preparation Resource

Question: 1 / 400

What is the "death benefit" of a life insurance policy?

The total premium paid over the life of the policy

The amount paid to the beneficiary upon the death of the insured

The death benefit of a life insurance policy refers specifically to the sum of money that is paid out to the beneficiaries upon the death of the insured individual. This benefit is intended to provide financial support to the survivors of the policyholder, allowing them to cover expenses such as debts, mortgages, and everyday living costs that may be impacted by the loss of income.

In the context of life insurance, the death benefit is a key component of the policy's purpose, which is to offer financial security and peace of mind both to the insured during their life and to their beneficiaries after their passing. It is important to note that the death benefit is typically not influenced by the premiums that have been paid or the cash value of the policy, which distinguishes it from other aspects of life insurance.

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The value of the policy if surrendered before death

The amount that can be borrowed against the policy

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