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How are term life insurance and permanent life insurance different?

by Brooke Jarchow

In the event of a tragedy, having life insurance could help financially protect your family. Choosing which type of life insurance is right for you and your family can depend on many personal factors, including your family’s current financial needs, any future financial obligations, and more. Below, we help explain the differences between the two main types of life insurance: term life insurance and permanent life insurance.

Term life insurance can provide low-cost coverage for a specific period of time. Term life insurance policies can provide coverage for 5 to 30 years, depending on the policy. While term life insurance may offer lower costs, it also expires. Once your term ends, you are no longer covered and your beneficiaries would receive nothing if you died. For this reason, it is important to decide whether you have more temporary coverage needs or if you anticipate needing coverage for a longer period of time.

Permanent life insurance can help provide life-long financial protection. Unlike term life insurance plans, permanent life insurance plans are usually just that: permanent. In addition, some permanent life insurance policies include a cash-value feature, allowing the policy to accumulate value during the policyholder’s lifetime. However, keep in mind that plans can differ by insurer and the state you live in, so make sure you understand the details of your specific plan.

Do you have questions about which type of life insurance plan is right for you? Call GoHealth to talk to an agent today: (888) 322-7557.

 

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