Death benefit remains level. Premium increases annually since, as the covered person ages, there is an increased likelihood of death.

Both the policy's death benefit and its premiums remain level for a predefined period of time: usually, five, ten fifteen, or twenty years.

The death benefit decreases each year while the policy's yearly premium stays the same. It reflects the fact that a certain level of premium purchases a reduced amount of protection with each passing annual term. This type of policy is often used to cover a mortgage or other loan obligation that has a decreasing balance.

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