Life insurance guide
Term life insurance
Term life insurance covers you for a set number of years, usually 10 to 30, for a fixed monthly premium. If you die during the term, your family receives the death benefit; if you outlive it, the policy ends.
What it is
You choose an amount and a length of time, for example $500,000 for 20 years. The premium is fixed and doesn't go up. If you die during those 20 years, your family receives $500,000, generally income tax-free. If you outlive the term, the policy ends.
There is no cash value and no investment inside it. It is protection only, which is why it gives the most coverage for each dollar of premium.
How it works
Why term is the usual starting point.
Most coverage per dollar
No type of policy buys more death benefit for the same premium.
Simple to understand
One amount, one length, one price. Nothing to manage while it's in force.
A length that fits your life
Match the term to when the children are grown, the mortgage is paid or you plan to retire.
Often convertible
Many term policies can be converted to permanent coverage later without a new medical exam.
Who it suits
Who it suits.
Parents of children under 18
If your children depend on your income, term life is how they keep their life as it is.
Homeowners with a mortgage
Your family shouldn't have to sell the house because your payments stopped.
Couples on two incomes
If one paycheck disappeared, could the household run on the other? For most couples, no.
Business owners
Funding for a buy-sell agreement or cover for a key person in the business.
Cost
What it costs.
A healthy 30-year-old can typically get $500K in coverage for $25–40 a month. Your price depends on your age, your health, the amount and the length of the term.
The premium is locked when the policy is issued, so buying earlier keeps it lower for the whole term.
Coverage and pricing depend on underwriting, eligibility, state availability, and carrier approval.
Comparison
Term and permanent coverage do different jobs.
| Topic | Term life | Whole life or IUL |
|---|---|---|
| Premium | Lowest | Higher |
| How long it lasts | 10 to 30 years | Lifetime |
| Cash value | None | Yes |
| Best for | Needs that end | Needs that last for life |
| Convertible | Often yes | Not applicable |
Questions and answers
What people ask us.
What happens when the term ends?
The coverage stops and so do the premiums. Many policies let you convert to permanent coverage before the term ends, and some can be renewed year by year at a higher price.
How long a term should I choose?
Long enough to cover the years someone depends on you: until the youngest child is grown, the mortgage is paid or you retire. We size the length to the longest of those.
Can I have more than one term policy?
Yes. Some families layer two policies, for example a longer one for income and a shorter one for the mortgage, so coverage steps down as needs end.
Related guides
Read next.
Life insurance overview
The main types side by side, and the job each one is designed to do.
Read the guideMortgage protection
A policy sized to your mortgage that pays your family, so the house stays theirs.
Read the guideWhole life insurance
Coverage that never expires, with a fixed premium and guaranteed cash value.
Read the guideSee what term coverage costs for you.
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