Also called: term life, permanent life
A payment to your beneficiary when you die. It is generally free of federal income tax. Term policies cover a fixed period; permanent policies last for life.
In RetIQ, premiums are added to expenses while a policy is active and the death benefit is added to the plan's brokerage in the year of death. The model assumes the surviving spouse receives it first; if both spouses die, it becomes part of the estate. RetIQ does not model a named beneficiary or policy ownership (for example, an ILIT).