When is the face amount of a Whole Life policy paid out?

The face amount of a Whole Life policy is paid out when the insured dies or at maturity. Whole Life insurance is designed to provide lifelong coverage, and it guarantees a death benefit to the beneficiaries when the insured passes away, regardless of when that occurs, as long as premiums are maintained.

Additionally, Whole Life policies have a maturity date that typically occurs at a predetermined age, often 100 years old. If the insured reaches this age, the policy pays out the face amount to the policyholder. This feature differentiates Whole Life insurance from term insurance, which only pays out if death occurs within the term of the policy. By ensuring that the face amount is paid either at death or at maturity, Whole Life policies provide a certain level of financial security to both the insured and their beneficiaries.

The other choices do not accurately reflect how the benefits of a Whole Life policy work. For instance, the retirement option suggests a time frame unrelated to the policy’s structure, while surrendering the policy refers to a specific action that does not guarantee a face amount payout in the same manner as the death or maturity stipulations.