What is a Life Insurance Death Benefit?

The death benefit of a life insurance policy is the amount of money that a life insurance policy pays to the beneficiary upon the policyholder's death.

Usually, the death benefit is paid to the beneficiary in one lump sum, but some insurers offer installment plans or other options.

The death benefit is usually free from federal income tax.

The beneficiary or beneficiaries can use the money from the life insurance death benefit to spend as they wish.

Many people buy a life insurance policy to provide financial security for their loved ones, so their family can maintain their lifestyle should the insured person die.

The death benefit from a life insurance policy can help to replace the insured's income for their family.