Life Insurance’s Most Common Flavors

When thinking about life insurance, some people are overwhelmed with their choices. There are different options that people have when it comes to life insurance. There are some that want term life, whole life, universal life, indexed universal life, survivorship universal life or variable universal life insurance. There are differences in all of them but not everyone is aware of these options. Everyone has a different situation and a different need when it comes to life insurance and should work with a professional to find the right policy for them.

Because most people choose not to work with a licensed insurance professional, they often choose between 2 policies. Term life and whole life insurance are 2 of the most commonly sold life insurance policies. These policies are often easier for people to understand and they can be the most affordable in many cases.

While these 2 policies are the most commonly sold, not everyone understands exactly what the difference in these policies are. There are distinct differences that should be explained. The differences in these 2 policies may lead to beneficial conversations before such an important decision is made.

Term Life Insurance

Term life insurance only insures a person for a specific period of time. These periods of time can be for as little as 5 years and up to 30 years. Once the time period is up, most people have the option to renew their policies or they can choose to go without the coverage. Many times, people choose to renew their policies at a different premium but not everyone.

Term life insurance has no cash value and many of these policies don’t have riders attached to them. Most term life insurance policies are only payable when the insured person dies. While it’s a horrible thought, it’s the reality of term life insurance.

There are 2 kinds of term life insurance policies, annual renewable or level premium. An annual renewable term life policy will allow the insured to renew their policy each year but the cost of their premiums may rise as they get older. This is something that not everyone wants. Level premium term life insurance allows the insured to lock in their premium cost for a specific period of time.

Whole Life Insurance

Whole life insurance is a permanent insurance policy that has a built in investment option. These insurance policies will pay a specific amount of money to the beneficiaries upon the death of the insured but the insured can use the policy while they are living as well.

Whole life policies build cash value during the life of the policy. As the policy gets older, the more cash value accumulates. If the insured wants to borrow against the cash value that has accumulated in the policy, they are allowed to without being taxed or penalized. This is one of the biggest differences between term and whole life.

The choice of life insurance is a deeply personal one. The differences in life insurance policies will not only affect the family of the insured after death, it will affect the insured as well. Before anyone chooses a policy, it’s important to speak with a professional. A professional will help find the best life insurance policy for everyone’s situation. 

Jun. 19 14'
Fred C / Of course you can have them all under one pocily, just talk to your friendly neighbourhood insurance broker. I have done fleets of mixed cars and truck, buses, etc, as large as 400. Remember, there will be no good driver discounts based on the individual drivers. However, you should be able to get a fleet discount based on a good accident record.
Jul. 7 15'


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