Ace California Life & Health Insurance Exam 2025 – Burst Into Your Bright Insurance Future!

The correct answer is endowment insurance. This type of life insurance policy is designed to pay the face amount, or the total insurance benefit, if the insured survives to the end of a specific term. In essence, it combines features of both life insurance and savings, as it rewards the policyholder for surviving the designated period.

Endowment policies typically have a shorter duration than whole life policies and are structured to provide a lump-sum payment after a set number of years, rather than a death benefit exclusively. If the insured passes away before reaching that term, the beneficiaries still receive the face amount of the policy.

Other types of insurance, like term insurance, provide coverage for a specific period but do not provide a benefit if the insured survives the term; rather, they pay only if the insured dies within that time. Whole life insurance offers lifelong coverage with a cash value component but does not specifically pay out based on survival at a certain point. Universal life insurance provides flexible premiums and death benefits without the specific endowment characteristic present in endowment policies. Thus, endowment insurance uniquely fulfills the condition set forth in the question.