Term Life Insurance

Term life insurance provides benefits to the beneficiary only in the event of death of the insured. No cash value accumulates on the beneficiary’s behalf. At the end of the term, the policy expires with no further benefits to the insured or beneficiaries. As with all insurance polices, they may be canceled at any time without unreasonable fees or penalties.

The advantage is that term insurance is less expensive than whole life. However, the added benefit of whole life is the accumulation of a cash value inside a fund having superior rates of return over that of comparable investments made by the policy owner. Term insurance cannot be paid inside a retirement plan, as generally there is no tax deduction for term life insurance premiums made by the taxpayer. Also, key man insurance policies should be established for people who are crucial to your company. Each of the various types of insurance should be carefully considered before a decision is made.