To which type of insurance policies does standard nonforfeiture law apply?

Standard nonforfeiture laws are designed to protect policyholders of certain types of life insurance policies from losing their benefits if they stop paying premiums. These laws primarily apply to whole life insurance policies, which are traditional permanent life insurance that provide coverage for the lifetime of the insured as long as the premiums are paid.

Whole life policies build cash value over time, which can be accessed by the policyholder; if they decide to terminate the policy, nonforfeiture laws ensure that they receive some value from the policy, even after they stop paying premiums. This is significant because it provides a safety net for policyholders, ensuring that they do not lose the value they built up through their payments.

In contrast, term life policies do not accumulate cash value and thus do not fall under these laws, as there is no benefit to retrieve upon cancellation before the term expires. Universal life policies may have their own set of flexibility but do not consistently adhere to the same nonforfeiture provisions as whole life. Accidental death policies provide a specific type of coverage that does not involve cash value accumulation, so they are also not subject to nonforfeiture laws. Therefore, whole life policies are the appropriate type of insurance to which standard nonforfeiture laws