Final answer:
In level term insurance, "level" refers to the premium, which remains the same throughout the term of the policy. It does not change with cash values or interest rates.
Step-by-step explanation:
The term "level" in level term insurance refers to the premium of the policy. This means that the premium amount stays constant for the duration of the policy's term. Level term insurance does not concern itself with the cash value, interest rates, or face amount in this particular context.
Level term insurance is designed to offer a fixed coverage amount, or death benefit, over the policy's term, which typically ranges from 10 to 30 years. Since the premium is level, policyholders have the benefit of knowing exactly what they will pay each month or year. It is not like a cash-value policy where the cash value can accumulate over time, nor does it involve changing interest rates. Unlike varying life insurance plans which may adjust premiums based on age or other factors, the level term insurance maintains a consistent premium cost throughout.