Question

what is life insurance? (1 point)
it is used to protect income in case of illness or injury for people younger than 65 years who have worked for at least 10 years.
it is often sponsored by the employer as part of benefits and provides protection to an employee while they cannot work and therefore earn enough money.
it helps cover costs for the day - to - day care of people with chronic illnesses, disabilities or disorders.
it is a contract purchased by the policyholder that commits the insurance company, in exchange for premiums paid, to pay a specified amount of money when the insured passes away.

Explanation:

The first option describes Social Security disability benefits, the second is short-term/long-term disability insurance, the third is long-term care insurance. Life insurance is a contract where the insurer pays a sum to beneficiaries upon the insured's death, in exchange for premiums.

Answer:

It is a contract purchased by the policyholder that commits the insurance company, in exchange for premiums paid, to pay a specified amount of money when the insured passes away.