Life insurance comes in two different options: temporary and permanent.
Temporary (Term) Life Insurance
Temporary life insurance is known as term life insurance, and is set up to cover you for a limited amount of time.
Some policies give you your money back, these are Return of Premium (ROP) Term Life Insurance policies.
Options range from 10 years, 15 years, 20 years, 25 years, 30 years, 35 years, and 40 years.
Once the term ends, you either can keep the coverage with it increasing in cost every year up until age 90 in most policies.
Or you can cancel it and buy a brand new one.
Permanent (Whole) Life Insurance
Permanent life insurance also known as whole life or universal life insurance is setup as a permanent insurance plan that has a fixed amount coverage with a fixed price in most cases that doesn’t change unless you die or cancel the plan.
With universal life insurance, you may have the option to accumulate cash value which will either be available for a loan later in life or will increase the death benefit amount as the policy is paid.
Unlike term life insurance, with universal life insurance, you have the option to pay off the policy early, this is known as a paid-up insurance policy.
In this option, you can pay off your insurance as early as seven years, but the most popular paid-up insurance plans are known as 10 pay, 15 pay, and 20 pay.
In these options, you pay off the insurance in 10 years, 15 years, or 20 years.