Term life insurance is coverage purchased for a specific term (10 or 20 years), after which the coverage can be renewed or converted to permanent insurance coverage without having to answer further health questions. Term life insurance is generally less expensive than permanent life insurance, although the renewal premiums can be significantly higher.

Permanent life insurance coverage lasts for your whole life, so long as premiums continue to be paid. It is typically more expensive than term insurance, at the beginning, but the premiums remain the same for the life of the policy. Permanent participating policies generate dividends and accumulate cash value that can increase the death benefit or be accessed while you’re still living, while Universal Life policies can accept additional deposits, adding a savings component to the policy.