Final answer:
The best type of life insurance policy for an individual who borrowed $10,000 from his bank on a 5-year installment loan would be decreasing term life insurance.
Step-by-step explanation:
The best type of life insurance policy that would be suited for an individual who just borrowed $10,000 from his bank on a 5-year installment loan requiring monthly payments is decreasing term life insurance. Decreasing term life insurance is a type of life insurance policy where the death benefit gradually decreases over time. This type of policy would align with the diminishing loan balance, providing coverage that corresponds to the remaining loan amount.