Whole Life Vs. Term:

There Are a Few Different Life Insurance Types To Consider:

Term Life Insurance:

  • Provides fixed length coverage for terms between 10 and 30 years.
  • Offers affordable plans.
  • High coverage amounts available.

Whole Life Insurance:

  • Provides coverage for life.
  • Builds a cash value in addition to the death benefit.
  • Gives a guaranteed death benefit payment.

Universal or Adjustable Life:

  • A more flexible whole life plan.
  • Coverage and premiums can be adjusted each year to meet you family’s needs.
  • A good alternative option to term plans for the budget conscious looking for life-long coverage.

First-to-Die:

  • A joint policy that provides life insurance for two people on the same policy.
  • Pays out the death benefit to the surviving policyholder when one of the insured passes away.
  • More affordable than buying two separate plans.

Survivor Life Insurance (Second-to-Die):

  • Like first-to-die plans, this whole life option covers two people.
  • Plans do not pay out until both policyholders pass away.
  • Cheaper than buying two individual plans.
  • Plans can be based on either whole life or universal life coverage.

Term Vs. Whole Life Insurance: Choosing the Right Type of Plan

One of the most important decisions when finding life insurance is choosing between term life and whole life insurance. Understanding your needs is an important part of determining which coverage option is right for you and your family.

When to Choose a Whole Life Plan

As whole life insurance lasts for life, people often choose whole life plans when they want to leave a guaranteed payment to their family, whether this is for funeral expenses, to leave a legacy, or anything else they wish to provide for. As whole life coverage is generally more expensive than term life insurance, it is good for people who want a lower level of coverage that lasts for life. Whole life insurance is a popular choice for people looking to protect their family from end-of-life expenses or costs associated with their death such as estate tax. So if you have high coverage needs, you may want to consider a term policy.

When to Choose a Term Life Plan

Term life insurance is the most affordable form of life insurance. Many people use term plans to cover financial obligations that will only last for a fixed time. As the longest plan only lasts for up to 35 years, people generally use term policies to provide for costs with a defined end such as mortgage payments, childcare costs, college expenses, or debt. Term life insurance is very popular with young couples and families with children. This is because young people who are just starting out in life often have high levels of financial obligations that they would like to protect their family from in the event of their death.