Term insurance is typically the most affordable, basic form of life insurance. Designed to offer protection for a specific period of time, it pays an income-tax-free death benefit to your beneficiary if you die within that specific time period.
When your policy term ends, your coverage terminates; however, some forms of term insurance are convertible into permanent insurance.
There is generally no cash value associated with term life insurance.
Whole life insurance is designed to last your entire life and pays an income-tax-free death benefit to your beneficiary when you die. These policies provide a guaranteed death benefit and a cash value that accumulates tax-deferred, based on a fixed interest rate. You can access the cash value through policy loans or withdrawals.
Some policies may offer nonguaranteed dividends that can provide potential for increase cash value or reduced premiums. Such policies may be more complex than other types of life insurance and require regular review of coverage.
Fixed Index Universal Life (FIUL)
FIUL policies are designed to provide lifetime coverage with flexible premium payment options, and income-tax-free death benefit. This flexibility lets you purchase one policy and adjust your coverage throughout your lifetime, without having to purchase additional policies as your financial needs change.
An FIUL policy’s cash value accumulates tax-deferred based on indexed interest or fixed interest allocations. The floor protects the cash value from negative changes in the index(es). FIUL policies typically offer greater potential for cash value accumulation than whole life insurance. You can access any available cash value through policy loans or withdrawals.
FIUL policies may be more complex than other types of life insurance and require regular review of coverage.Learn More