What’s the difference between Life insurance and Term insurance?

What’s the difference between Life insurance and Term insurance?

Life insurance and term insurance are two types of insurance products that are designed to provide financial protection to policyholders and their families in the event of the policyholder's death. However, they differ in a number of key ways.

Life insurance is a type of insurance that provides a financial benefit to the policyholder's designated beneficiaries upon the policyholder's death. This benefit is typically paid out as a lump sum, and can be used to cover expenses such as funeral costs, outstanding debts, and living expenses. Life insurance can be either permanent or term. Permanent life insurance, also known as whole life insurance, provides coverage for the entire lifetime of the policyholder, as long as premiums are paid. Term life insurance, on the other hand, provides coverage for a specific period of time, such as 10, 20, or 30 years.

Term insurance, on the other hand, is a type of insurance that provides coverage for a specific period of time, such as 10, 20, or 30 years. If the policyholder dies during the term of the policy, the designated beneficiaries will receive a financial benefit. However, if the policyholder does not die during the term of the policy, the policy will expire and there will be no financial benefit paid out. Term insurance is typically less expensive than permanent life insurance because it only provides coverage for a limited period of time.

In summary, the main difference between life insurance and term insurance is that life insurance can be either permanent or term, while term insurance only provides coverage for a specific period of time.