Whole life insurance Plan

Term life and whole life insurance are both insurance policies that allow you to leave a cash benefit for your beneficiaries after you pass. Term life is a temporary insurance policy that is less expensive but has an expiration date. Whole life insurance builds cash value and costs a little more, stays in force for the life of the insured as long as the premiums are paid.

Before you decide between term vs whole life insurance, first determine your needs and what you want the insurance to do. Are you looking for an insurance policy that protects you and your family from a life event, such as the loss of income from your death, or are you looking for more comprehensive protection?

Answering this question is important because the coverage amount for term and whole life policies can vary greatly based on several factors, such as the policy’s cost and qualification requirements.

If you are looking for something to help cover your final expenses, a specific type of whole life insurance called final expense insurance (also known as burial insurance or funeral insurance) may be best, depending on your age. But if you’re looking to protect your family from a loss of income, a term policy may be better suited. Your circumstances and needs will determine which type of life insurance is right for you.

Sometimes called permanent insurance, a whole life insurance policy provides coverage for your entire life as long as you pay the premiums. This type of insurance can accumulate cash value, which builds up in the policy as you pay your premiums. Depending on the provider, you can withdraw a policy’s cash value in the form of a policy loan or apply it toward the policy’s premium. Any unpaid policy loans will be subtracted from the death benefit.

Whole life policies pay death benefits to the primary beneficiary when you die. Unlike term plans, whole life policies provide coverage for your entire life. As long as the premiums are paid, the policy stays in force until you pass.

Another advantage of whole life insurance is that the policy premium is locked in for the life of the policy. This feature is important because typically life insurance costs more as you age and can be harder to qualify for. Locking in an affordable premium early can make a difference in affording life insurance as you get older.

Depending on the provider, most whole life policies don’t require a medical exam to qualify, you just answer a few health questions. This may make it easier to qualify if you have health issues.

Whole Life Pros & Cons

Just as with term life insurance, whole life insurance has its pros and cons. Here are some to consider:

Term vs Whole Life Insurance: Quick Comparison

There are some significant differences in term life insurance and whole life insurance. Check out the table below to learn the basic differences.