What is the insurance term for a contract that pays benefits when a policyholder dies?

Life insurance is an insurance contract that pays benefits when a policyholder dies, subject to its terms.

The policyholder pays premiums to an insurer, and the insurer promises a death benefit to named beneficiaries. The beneficiaries may be family members, a trust, a business, or another eligible party. The benefit is commonly used for income replacement, debt repayment, education costs, or estate planning.

Term life insurance provides protection for a specified period. Permanent forms, including whole life and universal life, can remain in force for much longer and may include a cash-value component. These forms differ in pricing, guarantees, and investment features.

Life insurance is distinct from accidental-death-only coverage, which generally pays only when death results from a covered accident. Policy exclusions, misrepresentation rules, and contestability provisions vary by jurisdiction and contract.