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Whole life insurance is a type of permanent life insurance which covers you for your whole life. It provides protection against risks such as sickness, disability or early death, and typically permit you to make loans against the cash value of the policy.
Term insurance is a temporary form of life insurance that lasts for a fixed period of time. Term policies are riskier than whole life policies because term policies end when you die and cannot be renewable like whole life policies can be. Term insurance generally has lower premiums than whole life insurance.
Whole life insurance can more cost-effectively provide protection against life events such as disability and early death. Term insurance cannot be as effective in protecting against these risks because there is a time limit on how long the policy will last. A term policy will not provide any coverage if your cash value falls below the amount of coverage provided by the policy itself when you die, assuming other conditions are met.
In the United States and Canada, most life insurance companies offer whole life policies. The main difference between whole life and term insurance is how much cash value a policy will provide after the policy expires. Pure whole life policies have a cash value equal to the face amount of the policy, regardless of death benefits. On the other hand, pure term life insurance does not provide any cash value; it pays off from the face amount at age 60, unless coverage is extended.
Term insurance is a temporary form of life insurance that lasts for a fixed period of time. Term policies are riskier than whole life policies because term policies end when you die and cannot be renewable like whole life policies can be. Term insurance generally has lower premiums than whole life insurance.
Whole life insurance can more cost-effectively provide protection against life events such as disability and early death. Term insurance cannot be as effective in protecting against these risks because there is a time limit on how long the policy will last. A term policy will not provide any coverage if your cash value falls below the amount of coverage provided by the policy itself when you die, assuming other conditions are met.
In the United States and Canada, most life insurance companies offer whole life policies. The main difference between whole life and term insurance is how much cash value a policy will provide after the policy expires. Pure whole life policies have a cash value equal to the face amount of the policy, regardless of death benefits. On the other hand, pure term life insurance does not provide any cash value; it pays off from the face amount at age 60, unless coverage is extended.
