Term life insurance pays out a stated death benefit if the policyholder dies within a specified time frame, usually 20 or 30 years. Term life premiums are much lower than premiums for permanent life insurance, which lasts your whole life and has a cash value componen🐲t. There is no cash value account with term insurance.

Permanent life insurance is an umbrella term for life ins🍃urance policies that last your whole life (as long as you pay the premiums) and usually include a cash value c🤪omponent. Permanent insurance includes whole, universal, and variable life insurance.

Whole life insurance provid🌞es coverage until you die, as long as the premiums are paid. It includes a cash value component that grow✅s at a fixed rate, and you typically pay the same premium every month.

Universal life in💯surance is permanent life insurance with a cash value that earns interest, as with whole lif𝕴e insurance. What makes universal life insurance different is that it features flexible premiums that can be adjusted over time. Universal life insurance can also offer either a fixed death benefit or one that increases over the course of the insured’s lifetime.

Variable life insurance is a type of permanent life insurance that builds cash value. Its main difference from other types🌳 of permanent life insurance is that the cash value involves separate accounts that invest in various securities instruments like stocks, bonds, and annuities. Variable life insurance is considered a securities contract as it involves investment risk.

Guaranteed-issue l𝓰ife insurance is a type of whole life insurance that does not require you to take ♓a medical exam, answer health questions, or allow the insurer to review your medical history. It is easier to get approved for but also costs more.

A death benefit is the amount of money a policy pays beneficiaries upon the insured's death. Death benefits for term policies are fixed amounts. For permanent insurance, the value of any unpaid loans taken against the cash value account within the policy is deducted from the death benefit. Death benefits are usually tax-free and paid in a lump sum or in installments.

Riders are additional benefits that can be bought and added to a basic life insurance policy. They allow you to customize a policy and can provide several kinds of protection if you meet their conditions🀅. Buying a rider means paying extra, but generally, the additional premium is low because relatively little underwriting is required.

Also referred to as living benefits or just accelerated death benefits, accelerated death benefit riders allow you to access your death benefit while you are alive, under certain conditions. These include covering the costs of a chronic, critical, or terminal illness, 🦋or long-term care. The payout🍷 ranges from 25% to 100% of the death benefit.