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Comparing types of life insurance

​Get the type of insurance that best meets your needs. The table below summarizes the types of insurance available and how each is most commonly used.

Type of life insurance policy Premiums and coverage time How this insurance might be used
​Term
  • ​Insurance coverage guaranteed for a pre-defined term, typically 5, 10 or 20 years
  • Premiums stay the same for length of the term
  • Renewal of term is guaranteed, but at a higher premium rate
  • Coverage ends at a specified age (often age 75 to 85)
  • Lowest cost form of insurance
  • ​Often used during working years to provide the capital needed to replace income when a key breadwinner dies
  • Coverage is not guaranteed for life, so may not be appropriate for estate planning goals
​Term to 100
  • ​Permanent insurance guaranteed for life
  • Premiums stay the same until age 100, or may in some cases be payable over 20 years
  • Typically has no savings component or cash value
  • Lowest cost form of permanent insurance
  • ​Pre-retirement – can be used to replace income if you were to die unexpectedly
  • Retirement – can be used to cover your estate’s tax liability or add to your estate’s value
​Universal life
  • ​Permanent insurance guaranteed for life
  • Premiums are adjustable depending on savings and insurance needs
  • Policy provides both insurance protection and tax-sheltered savings
  • ​Retirement – savings can be used to cover ongoing premiums, increase the policy’s death benefit or used as loan collateral to provide money in retirement
  • Estate – can be used to cover your estate’s tax liability or add to your estate’s value
Whole life
  • ​Permanent insurance guaranteed for life
  • Premiums stay the same for life
  • Policy has a cash value that you can borrow against, or cash out if you terminate the policy
  • ​Retirement – savings can be used as loan collateral to provide money in retirement, or withdrawn if you end the policy
  • Estate – can be used to cover your estate’s tax liability or enhance your estate’s value
Learn more about your life insurance options.
 

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