New Jersey Life Producer Law Practice Test

The characteristic that best describes individual life insurance is that the ownership and benefits are solely tied to a single individual. In individual life insurance policies, the contract is designed to provide coverage specifically for one person, meaning that the insured individual has control over the policy, including the selection of beneficiaries and the management of the policy itself. This focus on a single insured party is a fundamental aspect of how individual life insurance operates, distinguishing it from other forms, such as group insurance where coverage is applied to multiple individuals under a single contract.

While individual policies can be more expensive than group insurance (usually paid through employer benefits), and they can sometimes accumulate cash value (contrary to the last choice regarding cash value), the defining trait remains the singular ownership and benefit structure associated with one insured individual. This aspect emphasizes the personal nature of individual life insurance, tailored to meet the specific needs of an individual or their beneficiary.