What are the two types of life insurance?

The two basic types of life insurance are term life insurance and permanent life insurance.

Term life is temporary life insurance protection for a set period of time. If you outlive the term (duration) of your policy, your life insurance coverage ends.

If you die during the term, your beneficiary receives the death benefit from the policy.

Whereas, a permanent life insurance plan provides lifetime coverage, as long as you pay the premiums on time. Rates for permanent life insurance are higher than for term life because permanent life insurance does not expire, and may build up cash value inside the life insurance plan, from which you may be able to take a loan in the future.

If you have short term needs for life insurance of 30 years or less, term life may be an option; whereas, lifetime life insurance needs will be better suited for a permanent life insurance plan.

Term life insurance costs a lot less than permanent life insurance, which means you can afford a lot more life insurance protection for your family.

Learn more about term life insurance vs permanent life insurance and review the advantages and disadvantages of each.