What is a common feature of a life insurance policy?

A common feature of a life insurance policy is the provision of a death benefit to beneficiaries upon the insured's death. This fundamental aspect of life insurance provides financial security and peace of mind to the policyholder, knowing that their loved ones will receive a predetermined sum of money when they pass away. This payment is intended to help cover expenses such as funeral costs, outstanding debts, and ongoing living expenses for the beneficiaries, ensuring that their financial situation is stabilized following the loss.

Other potential features, such as coverage limited to specific circumstances or a fixed term of coverage, can apply to certain types of insurance, such as term insurance. However, they do not accurately represent the broad and essential characteristic that applies to life insurance as a whole, which is the provision of a death benefit. Guaranteed payouts after a specified period can be more relevant to products like annuities or certain types of investment products rather than traditional life insurance, further establishing the importance of the death benefit feature.