Short answerTerm life covers a set number of years and pays only if you die during the term. Whole life covers your entire life and builds cash value, with higher premiums. Match the policy to the job. Ask every agent how they get paid.
What life insurance is for
Life insurance replaces income when someone dies. If people depend on your paycheck, it protects them. If no one depends on your income, the need is smaller.
Term life, plainly
You pick a term, like 10, 20, or 30 years. You pay premiums during the term. If you die during the term, it pays the death benefit.
If you outlive the term, coverage ends. Term is the simplest type.
Whole life, plainly
Whole life covers your entire life as long as premiums are paid. Part of each premium builds cash value you can borrow against.
Premiums run higher than term for the same death benefit. Read the fees and rules before committing.
How agents get paid
Most life insurance agents earn a commission from the carrier when a policy sells. The commission does not change your premium.
It does shape incentives. Ask directly: how are you paid on this sale? An honest agent answers plainly.
Questions to ask any agent
- How are you paid on this policy?
- What happens if I stop paying premiums?
- Can the premium or the coverage change later?
- What is excluded during the first two years?
- How strong is the carrier, and who rates that strength?