Which of the following best describes the feature of decreasing term assurance?

Decreasing term assurance is specifically designed to provide a payout that diminishes over the life of the policy. As the term progresses, the sum assured reduces, which typically aligns with liabilities that decrease over time, such as a repayment mortgage. This structure is beneficial for policyholders who want to ensure their beneficiaries can meet specific decreasing obligations without needing the same level of cover throughout the duration of the policy.

This feature distinguishes decreasing term assurance from other types; for instance, a level term assurance keeps the payout amount consistent, while a whole life policy typically increases in value over time. Furthermore, the fact that it pays out in equal installments relates to specific types of income protection or annuity products rather than decreasing term assurance. Finally, the notion that it is only available to young individuals is inaccurate, as decreasing term assurance is available to a broad demographic, regardless of age. Thus, the description of decreasing term assurance as having a decreasing coverage amount over time is the correct characterization.