Final answer:
The correct answer is option b. ordinary whole life. Whole life insurance is a type of permanent life insurance that provides a death benefit as well as an accumulated cash value.
Step-by-step explanation:
The correct answer is option b. ordinary whole life. Whole life insurance is a type of permanent life insurance that provides a death benefit as well as an accumulated cash value.
With an ordinary whole life policy, like the one described in the question, the cash value grows over time and can be accessed by the policyholder through withdrawals or loans during their lifetime. This type of policy meets Rosie's needs because it offers both a death benefit and the ability to access the cash value.
The correct answer is option b. Ordinary Whole Life. Ordinary whole life insurance is designed to provide the insured with life-long coverage and includes a savings component, referred to as the cash value.
Over time, this cash value accumulates and can be accessed by the policyholder through withdrawals or loans, making it a versatile financial tool. This cash value continues to grow on a tax-deferred basis, and if Rosie chooses not to withdraw from it, the full cash value will be paid out to her beneficiaries in addition to the death benefit.
In contrast, the other options don't offer the combination of features that suits her needs exactly. Option a, the 20-year term with a double indemnity rider, offers no cash value accumulation.
Meanwhile, universal life options may provide flexibility with premiums and death benefits but have more complex structures that can be affected by interest rates and may not guarantee the same level of cash value as an ordinary whole life policy.