What is meant by "individual life insurance policy"?

An "individual life insurance policy" refers specifically to a contract of insurance that is issued to an individual person, rather than to a group of people. This type of policy is tailored to meet the specific needs of the individual insured, providing a personalized level of coverage. It typically involves the individual paying premiums that correspond to their risk profile, age, and other personal factors, ensuring that the coverage is directly linked to their circumstances.

In the context of life insurance, this means that the policy is designed to provide death benefits to the beneficiary chosen by the individual policyholder if the insured individual passes away. Individual policies can also come with various options and riders that allow for additional coverage or benefits, which may not be available with group policies offered by employers.

The other choices do not accurately capture the essence of an individual life insurance policy. For example, coverage provided by employers refers to group life insurance, which is distinct from individual policies. A policy that covers a whole family is more indicative of a family or joint policy, not an individual policy. Lastly, policies that are only available for a limited time typically describe term insurance, which can be a type of individual policy but does not encompass the broader definition of what an individual life insurance policy is.