Compare term and permanent policies

Term insurance covers a stated period and generally does not build cash value. It pays a death benefit if the insured dies during that period while the policy is in force, subject to its terms. Some term policies allow renewal, often at higher premiums, or conversion to permanent coverage within specified deadlines. A level premium applies only for the period the contract guarantees.

Permanent insurance is designed to provide long-term or lifelong coverage when its funding and other requirements are met. Whole life and universal life are examples, with different premium rules and guarantees. These policies may build cash value, but cash value is not automatically an extra benefit paid on top of the death benefit. Loans, withdrawals, charges, and surrender can affect values, benefits, and whether coverage continues. Distinguish guaranteed figures from projections in an illustration, and ask what payments would be required under less favorable assumptions.

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