Regarding life insurance, deciding which type of policy is best for you and your family’s needs cannot be easy. Term or whole life insurance? It’s essential to understand the differences between the two before deciding. For families in Coppell, TX, The Select Insurance Agency provides excellent advice and service for life insurance policies—read on to learn more about term and whole life insurance.
Term Life Insurance Basics
Term life insurance covers you for a specific period (typically 10-30 years). Your beneficiaries receive death benefits if you pass away during that time frame. With term life, the premiums are typically lower than those of whole-life policies because they do not accumulate any cash or loan value—which means that once the term ends, so does the policy.
Whole Life Insurance Basics
Whole life insurance lasts a lifetime (as long as you keep up with premiums). This type of policy accumulates cash value over time, which allows policyholders to borrow money from their policy as needed. Additionally, this cash value grows tax-deferred. The premiums are usually higher than those of a term policy because these policies also come with an investment component.
The Pros and Cons
Ultimately the choice between term and whole life insurance comes from personal preference and budget constraints. Term policies are less expensive than whole life but offer fewer benefits, whereas whole life offers long-term security but also comes with higher premiums. Both policies have pros and cons; while one might suit a particular family better, there is no “one size fits all” answer here.
If you live in Coppell, TX, and need help determining whether term or whole life insurance is best for your family, please consider contacting The Select Insurance Agency today!