The Difference Between Term Life and Permanent Life Insurance

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As you recall, there are two primary types of life insurance; term and permanent also called whole, life. Not only are they the most popular options, but they also happen to be the oldest forms of life insurance. Of course, insurance companies have made shopping for a policy just as confusing as the movie Inception as you dig deeper into a character’s subconscious.

But, let’s not get too far ahead of ourselves here. Sometimes it’s best to get back to basics so that life insurance isn’t as complex. And, that means explaining how term and permanent life insurance are different, as well as the advantages and disadvantages of each. Hopefully, with this knowledge, you can pick the right type of life insurance.

What Is Term Life Insurance?

This type of insurance offers affordable coverage, often with a guaranteed premium. The catch? It’s only for a specified period of time. Generally, term life insurance premiums are typically lower than premiums for permanent life insurance policies. However, renewal premiums may increase over time. As such, term insurance’s lower initial premiums make it an excellent option for those who need temporary or short-term life insurance coverage.