Question

What is a characteristic feature of a 20-pay life insurance policy?

A) Premiums are paid for the entire life of the insured
B) Premiums are paid for a limited period, such as 20 or 25 years
C) Premiums increase gradually over the policy term
D) Premiums are waived in case of disability

Answer 1

Premiums are paid for a limited period, such as 20 or 25 years.

Step-by-step explanation:

A characteristic feature of a 20-pay life insurance policy is that premiums are paid for a limited period, such as 20 or 25 years. This means that the policyholder pays premiums for a specific number of years, typically 20 or 25, and after that period, the policy is fully paid up and the policyholder no longer needs to make premium payments. This type of policy provides a set time frame for premium payments, making it appealing to those who want to have a fully paid-up policy within a specific time frame.