Question 1

What is term life insurance?

Accepted Answer

Term life insurance covers you for a specific period (10-30 years). If you die during the term, beneficiaries get the death benefit. If you survive, coverage ends with no payout. Premiums are low and fixed for the term period, making it affordable for families needing temporary protection.

Question 2

What is whole life insurance?

Accepted Answer

Whole life insurance covers you for your entire life. Premiums are higher but fixed for life. The policy builds cash value that you can borrow against or withdraw. Upon death, beneficiaries receive the death benefit plus any accumulated cash value.

Question 3

Which is cheaper: term or whole life insurance?

Accepted Answer

Term life is 70-80% cheaper than whole life. A $500,000 20-year term for a healthy 30-year-old might cost $30/month, while whole life could cost $200+/month. However, whole life builds cash value, while term has no cash value after it ends.

Question 4

Should I buy term or whole life insurance?

Accepted Answer

Term life is better for most people, especially young families: affordable coverage when you need it most. Whole life suits those wanting lifetime coverage and investment component. Compare: How long do you need coverage? Can you afford whole life premiums? Do you want cash value?

Question 5

Can I convert term life to whole life?

Accepted Answer

Many term policies allow conversion to whole life without medical underwriting. This is valuable if your health deteriorates. However, you'll pay higher premiums retroactive to the issue age of your original term policy. Check your policy's conversion provisions.

Term vs Whole Life Insurance Comparison

Detailed Comparison