Two of the most common types of life insurance are whole life and term life. They both provide a death benefit in the event the policyholder should pass away while the policy is in force, but that is about where the resemblance ends. Below are descriptions of each type of coverage and an explanation of how to decide between them.

What Is Term Life Insurance?

Term life offers coverage for a specified term, typically 10, 20, or 30 years. It is fairly basic and bare bones. It rarely requires a medical checkup. The monthly premium normally never increases—although some few policies have language that permits increases—during the term. After the term runs out, you have the option of renewing, but at a higher rate that reflects your increased age.

What Is Whole Life Insurance?

Whole life is permanent insurance. It lasts until you die, assuming you keep up with the payments each month, and the payments never increase. It is more expensive than term life is and may require a medical exam for you to qualify. However, along with the increased cost, it also offers more benefits. Part of your premium is directed into an investment account, and this money grows tax-free until you withdraw it during retirement. Some policies include payouts for disability and dismemberment, as well.

How Do You Choose?

If you seek life insurance that is easy to get, costs very little, and is only in effect temporarily—say, until the kids turn 18 or until the mortgage is paid off—then term life may be the right choice for you. It is cost-effective, uncomplicated, and efficacious. On the other hand, if you want to make sure that your survivors receive a payment after your death, whenever that occurs, and you like the idea of an enforced savings/investment plan—as well as some other attractive bells and whistles—you may prefer a whole life policy.

To discuss your life insurance options with a friendly, experienced agent, contact Russell Insurance Agency in Robertsdale, AL. They have been helping clients throughout Baldwin County design the right coverage for more than 20 years. They also specialize in auto, motorcycle, business, and homeowners insurance. Visit their website to view a map and office hours or call (251) 947-3607 to request a free quote.