The
Difference Between Term Insurance and Permanent Insurance
Term
insurance provides coverage for a specific period of time.
It pays a benefit only if you die during the term. Some term
insurance policies can be renewed when you reach the end of
the specific period. Others give you the ability to reenter.
The premium rates increase at each renewal date or each reentry.
Many policies require that evidence of insurability be furnished
at reentry for you to qualify for the lowest available rates.
Initially, premiums
are generally lower than those for permanent insurance, allowing
you to buy higher levels of coverage at a younger age, when
the need is often the greatest.
Permanent insurance
is designed to be a lifelong policy and is known by a variety
of names. As long as you pay the necessary premiums, the death
benefit always will be there. These policies are designed
and priced for you to keep over a long period of time. |