Term vs. Whole Life Insurance: What's the Difference?

Term life insurance covers you for a set number of years — typically 10, 20, or 30. If you pass away during the term, your beneficiary receives the death benefit. If you outlive the term, the policy ends with no payout.

Whole life insurance is permanent. It covers you for your entire life as long as premiums are paid, and it builds cash value over time that you can borrow against or withdraw.

Term costs significantly less per dollar of coverage, making it the right fit for income replacement during working years, paying off a mortgage, or protecting young children. Whole life costs more but provides lifetime certainty and a guaranteed cash value.

Many families use a blend: a large term policy for the years they need the most protection, plus a smaller whole life policy for permanent needs like final expenses and legacy planning.