Tennessee Insurance Practice Exam 2026 – All-in-One Resource for Exam Success!

A 15-year mortgage is best protected by a 15-year Decreasing Term life insurance policy because this type of policy is specifically designed to align with the concept of mortgage protection. The primary goal of using life insurance in this context is to ensure that in the event of the insured's death, the policy benefit can cover the remaining mortgage balance, which decreases over time as payments are made.

With a 15-year Decreasing Term policy, the death benefit is structured to decrease at a predetermined rate, mirroring the decline of the mortgage balance. This ensures that the coverage remains appropriate throughout the duration of the mortgage, providing financial security for beneficiaries who would otherwise be responsible for the remaining mortgage payments.

Other life insurance types, such as Permanent Whole Life, 30-year Level Term, or Universal Life, do not efficiently match this decreasing need over a specific 15-year period. Permanent Whole Life policies provide lifelong coverage with consistent premiums and a cash value component, which is not necessary for a temporary obligation like a mortgage. A 30-year Level Term offers a fixed death benefit for a longer period, thus overshooting the requirements for a 15-year mortgage. Universal Life policies provide flexible premiums and death benefits but do not correspond specifically to the decreasing need associated