What is "whole life insurance"?

Whole life insurance is defined as a permanent insurance policy that provides coverage for the entirety of the insured's life, as long as premiums are paid. One of the key features of whole life insurance is that it accumulates cash value over time, which can be borrowed against or withdrawn by the policyholder. This characteristic of providing lifelong coverage and the benefit of accumulating cash value are why this option is correctly identified as whole life insurance.

The fundamental aspect of whole life insurance is its permanence. Unlike term insurance, which provides coverage for a specified period and can expire, whole life ensures that policyholders have continuous coverage. Additionally, the distinction from universal life insurance lies in the structure of the premiums and the benefits. Whole life typically has fixed premiums and benefits, whereas universal life offers more flexibility in premium payments and death benefits. This makes option B the most accurate definition of whole life insurance within the context provided.