The Pros, Cons, And The Difference Between Term And Whole Life Insurance

Are you thinking about buying life insurance, but don’t know where to start? Here’s a money saving tip: get it while you’re still young(er) and healthy!

Now, let’s look at the main two insurance options: term life and whole life insurance. We are going to examine pros and cons and the difference between term and whole life insurance policies.

What Is Life Insurance and How Does It Work?

Life insurance provides financial protection by protecting your lost income if you were to unexpectedly die. You create a contract with an insurance carrier that is paid by a yearly or monthly premium.

Premiums are based on the type of insurance you are obtaining and the statistical risks posed to the carrier (your age, career, medical conditions, etc).

It is particularly important to have a life insurance policy when you have family members that depend on your income. This is because the death benefit (which is the total amount paid out by your life insurance company) can replace your income, pay for funeral costs and cover any debts that you may have by awarding these funds to your chosen beneficiary.

Term Life Insurance

Term life insurance serves the sole purpose of providing a death benefit to your chosen beneficiaries if you were to pass away in a given period of time.

The term length of the policy can range from 10 to 30 years, but are often customizable if you need a different length of coverage time. As long as you continue to pay the premiums determined by the insurance carrier, you will be covered until the term expires.  

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