April 11, 2023
Term Life Insurance vs Whole Life Insurance
What’s the Difference?
While most people know that life insurance will pay a sum of money to their beneficiaries if they pass away, they may not realize the differences between whole life insurance and term life insurance.
Which type is right for you? It depends on your individual needs and circumstances. Let’s break down each:
TERM LIFE INSURANCE
Term life insurance is a type of policy that provides coverage for a predetermined amount of time—typically between 10 and 30 years. The premiums are usually lower because they do not have a cash value component and may expire without paying any benefits. This product is a great way to help ensure your family’s financial security in the event of your premature death. It is a cost-effective way to provide them with the financial means to possibly pay off debts and continue to maintain their standard of living.
Some of the benefits of term life insurance include:
~Affordable Premiums – Term life insurance offers very competitive premiums, making it a great way to provide your family with financial protection without breaking the bank.
~Flexibility – Term life insurance is flexible and can be tailored to meet your specific needs. You can choose the amount of coverage you need and the length of the policy.
~Guaranteed Tax-Free Death Benefit – The death benefit from term life insurance is paid to your beneficiaries tax-free should you pass away during the term of the policy.
~Simplicity – Term life insurance is easy to understand and can be a simple, affordable way to safeguard the financial health of your loved ones.
WHOLE LIFE INSURANCE
Whole life insurance offers more comprehensive coverage that lasts for the policyholder’s entire life. It is typically more expensive because it offers coverage that’s designed to last a lifetime and payout regardless of when you pass away.
Some of the Benefits of Whole Life Insurance Include:
~Lifelong Coverage – The policy remains in force as long as the premium is paid. The policy won’t be canceled if your health should decline.
~Fixed Premiums – Premiums typically remain the same over the life of the policy
~Cash Value Accumulation – Whole life insurance can accumulate cash value. Once you’ve built up enough cash value, you can borrow against it or surrender the policy for cash if needed.
~Guaranteed Tax-Free Benefit – Coverage lasts a lifetime and pays out to your beneficiaries regardless of when you die.
When it comes to life insurance, remember – you’ve got options. By choosing either a term or whole life insurance policy, you can rest assured knowing that you’ll be helping to provide financial security to your family no matter what.
By contacting us, you may be offered information by an agent about purchasing life insurance or annuity products.
Ready to learn more about your life insurance options?
Connect with a KSKJ Life agent today!