Term life insurance is the most common, most affordable form of life insurance. You pay a level monthly premium for a set term - typically 10, 20, or 30 years - and your family receives the death benefit if you pass during that window. No cash value, no investment, just protection.
Typical cost
$25-$60 / month for a healthy 40-year-old buying $500K of 20-year coverage. Smokers and applicants with health conditions pay more.
Best for
- New parents with young children
- Homeowners with a mortgage
- Anyone with a time-limited financial obligation
- Buyers who want maximum coverage for the lowest premium
How it works
- 01
You choose a term length (10/20/30 yrs) and face amount.
- 02
Underwriting (medical exam usually required) determines your premium.
- 03
Premiums stay level for the entire term.
- 04
If you pass during the term, beneficiaries receive the death benefit tax-exempt.
- 05
If you outlive the term, coverage ends (most policies offer conversion to permanent without a new medical exam).
Pros
- • Cheapest dollar-for-dollar life coverage available
- • Simple - no investment complexity
- • Often convertible to permanent coverage later without new underwriting
Cons
- • No cash value or investment growth
- • Premiums rise dramatically if you renew after the term ends
- • Coverage ends when the term ends