Which option is a characteristic of a whole life insurance policy?

Whole life insurance is a type of permanent life insurance that provides lifelong coverage, as long as the premiums are paid. One key characteristic of whole life insurance is its ability to accumulate cash value over time. This cash value grows at a guaranteed rate and can be borrowed against or withdrawn by the policyholder, making it a unique financial asset compared to term life insurance policies, which do not build cash value.

In addition to providing death benefits, the component of cash value is a significant advantage. This feature allows policyholders to potentially use their policy as a savings vehicle, increasing its appeal beyond mere insurance coverage. As the cash value grows, it can also serve as collateral for loans, contributing to its overall flexibility.

In contrast, other choices represent features that do not align with whole life insurance. Some policies provide coverage for a specific term, while others may expire when the insured reaches a certain age. Additionally, all life insurance policies, including whole life, require regular premium payments to maintain the coverage, negating the possibility of having no premium requirements.