Term insurance (Sometimes called ‘Temporary Insurance’)

Term coverage

is insurance protection that covers you over a fixed period of time. It has a set term of coverage for common time periods of 10, 20, and 30 years (some product providers have more options than this). The policy owner can let the coverage cease at the end of the term, or choose to renew the coverage for another term at their then current age.

Permanent Insurance (coverage that lasts as long as you do)

Whole Life

is a permanent policy with guaranteed and non-guaranteed cash values. These values grow in a tax-deferred environment and may be accessed while the insured is still alive. This policy also has a guaranteed death benefit. The owner is required to pay a fixed premium amount that remains the same for the life of the contract, or until the policy has been paid up. These policies can be paid up in 8 years, 10 years, 15 years, 20 years, or payable for life.

Universal Life

is a permanent policy that may provide non-guaranteed cash values. The growth of this cash value is tax-deferred and may be accessed while the insured is still alive. The owner of the policy can choose to pay a minimum, up to a maximum premium amount. The minimum premium amount is calculated by the insurance company and is required to keep the guaranteed death benefit in place. The maximum amount is determined by federal tax legislation, and will have an effect on the non-guaranteed cash values. These policies can be paid up in 10 years, 15 years, 20 years, or payable for life.

Term 100

is a permanent policy that has no cash value, but provides guaranteed coverage as long as the premiums are paid. These premiums are paid for life, or until age 100.

*A properly structured life insurance policy ensures that all death benefit proceeds are paid tax-free to the named beneficiaries.