Understanding Term Life Insurance and Whole Life Insurance

term life

The decision to purchase life insurance is an important one for any family. Once you pass, your household will be left to pick up the pieces as life moves forward. Financially, this can add tremendous amounts of stress to an already terrible situation. Using a life insurance policy as a viable tool for your loved ones can help them during their time of need; however, deciding the right type of policy will determine how your family benefits.

Term Life Insurance Vs. Whole Life Insurance

Term life insurance and whole life insurance policies are the two most popular coverage options in the United States. Both are viable options but will protect in different ways and should be considered differently depending on where you are in your life. Learn more about each coverage, how they differ, and which option is right for you.

Term Life Insurance

A term life insurance policy provides a financial benefit upon your death should it occur within a certain term. For example, if you were to pay your premiums for a 30 year term life insurance policy and pass in the 27th year of that term, your beneficiary would receive a death benefit. Term life insurance policies cost less in premium. Depending on your insurance provider, you may be able to convert your term life insurance policy into a whole life insurance policy should you survive throughout the entire term; however, terms and conditions may apply. Some policies may also be up for renewal once it reaches their end, but your rate could increase tremendously as a result. It is best to ask your agent about the specifics of your policy to understand your options.

Whole Life Insurance

A whole life insurance policy also provides a death benefit should you meet your demise, but your coverage is in place for the rest of your life instead of a specific term. You’ll pay more for this coverage, but there are additional components you should also consider:

  • Your policy may create wealth for you and your family through potential dividends and cash value. Over time, your premiums can grow to be used for loans and withdrawals. Each policy is different and how you access these funds can affect the overall benefits your family sees once you pass.
  • Whole life insurance policies may also be used for paying off an estate to help your family retain your estate without the potential financial burdens which can accompany such windfalls.

As an investment, the right whole life insurance policy can help you prepare your affairs both before and after you pass. The right insurance agent can help you identify if whole life insurance is the right protection for your household.

Comparing Term and Whole Life Insurance Policies



Is Term Life Insurance or Whole Life Insurance Better?

This depends on a variety of personal factors. Each household is different and so too are the needs of your home. Life insurance is a powerful financial tool and by reviewing your needs, you can determine whether term life insurance or whole life insurance is the right coverage for your loved ones:


Life Insurance Built to Protect Your Loved Ones


According to the research from the LIMRA 2020 Insurance Barometer Study, there are around 41 million people in need of life insurance coverage who are not covered but need a policy. Life insurance policies are often associated with being an option for only the wealthy, but this is not the case. Financial difficulties after death can affect your home no matter what your financial status may be. At Freedom Insurance Group, we help you find the best policy for your needs all while saving you money in the process.

Our agents get to know you and your needs to find the right life insurance options to keep your loved ones protected. By working with a variety of top-rated insurance brands, we can compare your coverage needs to find the protection you require for the best price on the market. Get a free life insurance quote from Ethos, a leading life insurance provider, or speak with one of our agents today!

Contact Us

Freedom Insurance Group
3861 Long Prairie Rd Ste 110
Flower Mound, TX 75028
Phone: (972) 798-3769


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