What type of life insurance policy does not pay dividends to the policyholder?

A non-participating policy does not pay dividends to the policyholder because it is designed to provide a guaranteed death benefit and set premiums without the potential for profit-sharing. In life insurance, participating policies are those that allow policyholders to receive dividends based on the insurer's profits and performance. Universal life policies, while offering flexible premiums and death benefits, typically do not provide dividends in the same manner as participating whole life policies. Term policies, which are designed to cover a specific period and do not build cash value, also do not pay dividends. Therefore, the defining feature of a non-participating policy is its absence of dividends, making it the correct choice when identifying a type of policy that does not provide this benefit to its holders.