What is the difference between Term and Permanent Life Insurance?

Term insurance

Term life insurance is the original form of life insurance and is considered to be “pure” insurance because, in contrast to permanent life insurance, it builds no cash value. You pay a monthly premium based on the number of years you want coverage — term length — and the amount of coverage you choose. If the insured dies during the term, the death benefit is paid to the beneficiary. Here are the main characteristics of term life insurance:

	*Temporary insurance coverage
	*Low cost
	*No cash value
	*Usually renewable without evidence of insurability but typically at a higher premium
	*Sometimes convertible to permanent life insurance

Permanent life insurance

Typically, permanent insurance stays in force as long as you live, providing the premiums are paid in a timely manner. Permanent insurance combines a death benefit with a cash value, or savings component, which grows tax-deferred*.
Here are the main characteristics of permanent life insurance:

*Permanent insurance coverage

*More expensive to own

*Builds cash value

*Loans are permitted against the policy

*Favorable tax treatment of policy earnings*

*Level premiums

Contact me to discuss which would be best for your family.