What does the term "premium" signify in life insurance?

In life insurance, the term "premium" signifies the fee paid to maintain the insurance coverage. This payment is typically made on a regular basis, such as monthly or annually, and is essential for keeping the policy active. The premium is determined based on various factors, including the insured's age, health status, and the amount of coverage selected. Ensuring that premiums are paid in a timely manner is crucial, as failure to do so may lead to the policy lapsing and the loss of the benefits it provides.

The other choices do not accurately describe the term "premium." The total value of the policyholder's coverage relates to the death benefit, not the premium itself. Discounts on annual policy rates are not directly related to the concept of a premium but rather to pricing strategies or incentives offered by insurance companies. Lastly, the sum of benefits received by the beneficiaries refers to the payout made upon the policyholder's death, which is separate from the premium payment that keeps the insurance policy in force.