Which of the following options is a common characteristic of participating policies in life insurance?

Participating policies in life insurance are designed to allow policyholders to share in the insurer's profits. This is primarily done through the payment of dividends. When the insurer performs well financially, excess profits may be distributed back to the policyholders in the form of these dividends. The dividends are typically distributed annually and can be used in various ways, such as reducing future premiums, purchasing additional coverage, or being received as cash.

In contrast, options like lower premiums, guaranteed cash value, and no guaranteed death benefit do not align with the fundamental features of participating policies. While some permanent life insurance policies may build cash value and potentially reflect lower premiums compared to other policies, these characteristics are not universal to participating policies. Furthermore, all life insurance policies, including participating ones, come with a guaranteed death benefit as long as the premiums are paid, which contradicts the notion of "no guaranteed death benefit."

Therefore, the characteristic of policy dividends returned to policyowners is what defines participating policies, distinguishing them from non-participating policies that do not offer dividends.