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    Term Life Insurance vs Whole Life Insurance

    There are two main types of life insurance: term and whole life.
    It is common to wonder which type of insurance is right for you. Ultimately, the question to ask is: which one best suits your needs?

    Term Life Insurance vs Whole Life

    Term Insurance: Provides coverage for a specified period of
    time and pays a benefit if you pass away during the term.

    Why Consider Term?

    • Cost-effective coverage compared to
    whole life insurance.

    • Ideal for those who need coverage for a
    specific period of time.

    • Supplement whole life insurance.

    • Can be renewed at annually increasing rates
    without proving insurability.

    • Possibility of converting it into a whole life insurance policy later on.

    • Income tax-free death benefit. *1

    Whole Life Insurance: Provides lifetime coverage and can
    provide cash value accumulation within the policy.

    Why Consider Whole Life?

    • Lifetime*2 coverage as long as premiums are paid.

    • Tax-deferred growth of policy cash values.

    • Liquidity through policy loans *3.

    • Can help supplement retirement income *4.
    A stable financial asset on your balance sheet.

    • Income tax-free death benefit.

    Long-Term Considerations:

    Do you want coverage for a specific period of time or do you want lifetime*2 coverage?
    Studies show that many people are living longer.*5 This is important to consider when selecting life insurance. If you select term insurance, you may be at a higher risk of outliving your policy.

    Are you more interested in a short-term, cost-effective option, or would you like the opportunity to build up cash value
    overtime?
    If you select whole life insurance, the cash value grows tax-deferred over the life of the policy and can be accessed through a loan to help provide an emergency fund or to supplement educational expenses or retirement income.*3

    Term insurance can be cost-effective, but there is no cash buildup.

    Would a combination of the two work for you?
    A combination policy can offer some of the advantages of both types of insurance. By combining a smaller whole life policy and a term life policy that can convert into whole life, you can have an affordable plan that meets your protection needs while also establishing a lifetime asset.

    Additional information

    1* Life insurance benefits are usually included in one’s estate. While beneficiaries generally receive death benefits free of income taxes, your estate may be taxed. A tax advisor should be consulted if your estate is sufficiently large to be subject to estate taxes.

    2* Whole life policies have a maturity date at which time cash value is distributed.

    3* In the early years of the policy term, there is usually not enough loan value. Outstanding loans reduce the death benefit.

    4* Withdrawals to supplement retirement income are treated like a policy loan.

    5* U.S. National Center for Health Statistics; Centers for Disease Control and Prevention; Health, United States, 2016 Report; Published 2017 C5699 (9/18).

    Get your insurance today

    Contact us and we’ll help you choose the best option for you.

    • (646) 604-2988
    • (203) 900-3353
    • www.calics.com