While whole life and term life both have fixed premiums that never increase, whole life provides coverage for the rest of the insured person’s life, whereas term only provides coverage for a fixed period of time. Whole life policies also often include cash value that accumulates over time, while term life does not. However, term life has a substantially lower premium per dollar of coverage and there is typically more coverage available.

Term life and universal life are substantially different products: universal life has a variable premium and death benefit amount, whereas term is fixed. Universal life is a permanent life insurance product, whereas term life only lasts for a certain period of time. In essence, universal life combines protection with investment potential (and some accompanying risk), whereas term life provides simple, reliable protection for the period of time when it is most needed.

Term life insurance is the most affordable life insurance product per dollar of coverage, which is why it’s often a preferred option for people who are just entering their prime earning years to protect against loss of income. In addition to the death benefit amount, factors that may affect the price include your age at the date of issue, gender, term duration, overall health, and tobacco use.