What type of policy might include a spendthrift provision to protect a beneficiary's interests?

A spendthrift provision is included in some life insurance policies to protect a beneficiary's interests by preventing them from accessing the proceeds of the policy too readily, especially in the case of creditors or poor financial management. Whole life policies are often associated with this type of provision because they are designed to provide lifelong coverage and typically accumulate cash value over time. This cash value aspect, along with the certainty of the death benefit, makes it prudent to include protections like a spendthrift provision.

Additionally, since whole life policies often have a fixed premium and benefit structure, the inclusion of such provisions can help ensure that the intended beneficiary does not mismanage the funds upon receiving them. This is particularly important given that beneficiaries may be young or inexperienced in managing large sums of money. In contrast, while term life, universal life, and variable life policies can also provide coverage, they typically do not have the same focus on cash value accumulation or the long-term financial stability that suggests the need for a spendthrift clause.