Term & Whole
Term Life Insurance
A type of life insurance with a limited coverage period. Once that period or “term” is up, it is up to the policy owner to decide whether to renew or to let the coverage end. This type of insurance policy contrasts with permanent life insurance, which is intended to provide life-long protection.
Other characteristics of term insurance include:
No cash value
Sometimes convertible to permanent life insurance
Whole Life Insurance
Whole life insurance is a contract with premiums that includes insurance and investment components. The insurance component pays a predetermined amount when the insured individual dies. The investment component builds an accumulated cash value the insured individual can borrow against or withdraw. This is the most basic type of cash-value life insurance.