A life insurance policy is essential to protecting loved ones from a financial burden upon your death. While the purpose is straight forward, choosing a plan isn't always an obvious decision. There are two main options available: whole and term. Here's a closer look at each policy type to guide you in making a decision.

What Is Whole Life Insurance?

Whole-life plans are the standard choice for many families. This policy style is permanent and will not expire. The rates are also locked-in, meaning the premium you start with stays the same regardless of your circumstances, including illness and age. It's a popular plan for young individuals who want to take advantage of lower premiums. 

While whole life insurance rates are usually higher than term, there are more perks. For example, the plan has a cash value that grows as it ages. Many insurance companies allow policyholders to borrow against the cash value or cash-out the policy tax-free. Some providers also reward clients with annual dividends, making it a viable investment for many individuals.  

What is Term Life Insurance?

Term-life policies are known for their affordability. However, they are temporary. Plans can only be purchased for a set period of time, with a range of 10 to 30 years. Aside from death benefits, these policies don't offer any other financial value.

Straight-to-the-point coverage is an excellent choice for a variety of circumstances. Many policyholders opt for a term-life plan that coincides with the length of a loan, such as a mortgage, to ensure it will be covered. It also offers peace of mind for individuals with underage dependents as they can insure themselves up until their children reach adulthood. 

Not sure which style of life insurance is right for you? Reach out to Liberty Mutual® Insurance Agent Aaron Unell in St. Louis, MO. Local residents depend on this insurance agent and his staff for honest and personalized service. They will carefully listen to questions, address concerns, and thoroughly review policy options to find one that best fits your situation. Learn more about Aaron and his team online or call (314) 750-0317.