Life Insurance Term vs Permanent: What Are the Differences?


A recent survey revealed that right around 25% of Americans don’t have life insurance. If you fall into this category, you should aim to do something about it soon.

You can sign up for a life insurance policy in no time at all online these days. But before you do, you should figure out if term life insurance or permanent life insurance would be the better option.

Making a decision on life insurance term vs permanent will start with getting to know more about each of the two options. Find out all about them below in our term vs permanent life insurance guide.

What Is Term Life Insurance?

Term life insurance is a type of life insurance that’s only going to last for a set period of time. More often than not, you’ll be able to choose a term life insurance policy that will last for 10, 20, or 30 years.

If you pass away during this term, your beneficiaries will be entitled to the benefits that come along with your specific term life insurance policy. Otherwise, your term life insurance policy will eventually end at the conclusion of your term without any benefits being paid out on your behalf.

What Is Permanent Life Insurance?


While term life insurance is only designed to last for a set period of time, permanent life insurance is, as its name would suggest, life insurance that will last until the end of your life. You won’t have to worry about your life insurance policy going away at any point as long as you continue to pay for it.

It doesn’t matter if you pass away tomorrow or 40 years from now. Your permanent life insurance policy will remain valid, and it’ll provide your beneficiaries with the benefits associated with it at the time of your death.

What Are the Differences Between Term and Permanent Life Insurance?

The biggest difference between life insurance term vs permanent is obviously the length of time that it lasts. A term life insurance policy won’t last for as long as a permanent one will.

But there are also other differences. For example, a term life insurance policy will often cost a lot less than a permanent life insurance policy. You’ll notice this when you’re shopping around for life insurance quotes to see what kind of coverage you’re eligible to get.


Life Insurance Term Vs Permanent: Which Should You Pick?

Picking out a life insurance policy isn’t something you should do on a whim. It’s important to spend the right amount of time looking around for a life insurance policy that you like.

It’s also important to understand the life insurance term vs permanent differences so that you can choose the right type of policy. After finding out a little bit more about each option here, you should have a slightly better idea as to which kind of policy you want to get.

Read up on some of the other types of insurance you should consider signing up for in our other blog articles.