Which nonforfeiture option provides the most life insurance protection?

The extended term option provides the most life insurance protection among the nonforfeiture options. When a policyholder stops paying premiums, the extended term option allows them to use the cash value of the policy to purchase a term life insurance policy for a specified period of time, typically equal to the value of the original policy. This means that the policyholder maintains a level of life insurance coverage, often for a duration that matches the value of the original whole life coverage, without the need for paying further premiums.

In contrast, the reduced paid-up option converts the policy into a paid-up permanent policy with a lower death benefit and no further premiums, which means there is less protection than originally provided. The paid-up additions option involves adding accumulated cash value to a new policy, but it doesn’t extend the protection in the way the extended term does. The cash surrender option provides a cash payout but terminates all coverage, resulting in no life insurance protection at all.

Thus, the extended term option is designed to maximize life insurance coverage at the point of conversion after premium payments cease.