Term vs. Whole Life Insurance

by Christy McFarland

If somebody asked you about the difference between term and whole life insurance, could you tell them? If not, we don’t blame you. Life insurance can seem overwhelming, but it doesn’t have to! 

An easy way to think about term vs whole life insurance coverage is comparing them to the idea of renting or owning a home, where term life insurance would be "renting" and whole life insurance would be "owning." 

Term life insurance

• Good for a specific period of time, such as 10, 20 or 30 years
• Premiums are generally lower than those for whole life insurance 
• What you pay for the policy won't go up for that specified term, although the longer the term, the higher the cost

Whole life insurance

• Lifelong protection as long as you pay your premiums
• You can accumulate a cash value 
• Most often, the cost or premiums of the policy is guaranteed for life - so it won't change