Ohio Life Insurance Practice Exam 2026 – Your All-in-One Guide to Exam Success!

An endowment policy is designed to provide a payout, known as the endowment benefit, either upon the maturity of the policy at a specific age or upon the death of the insured, whichever occurs first. This key characteristic makes option A correct, as the policy matures at a predetermined age set by the policyholder, leading to a guaranteed benefit after a certain period.

Endowment policies differ from other types of life insurance in various ways. For example, whole life insurance typically offers lifelong coverage with premiums that are generally higher due to its cash value accumulation and death benefit extended over the insured's lifetime. In contrast, term life insurance provides coverage for a limited period and does not accumulate a cash value, hence the accumulation is not slower or faster; it simply does not exist in this type of policy.

Furthermore, option D inaccurately describes an endowment policy. While it provides coverage linked to the payment of a benefit, it is not limited only to a specified amount; rather, it is structured to ensure a payout upon maturity or death within the policy's terms.