Which life insurance type provides coverage for a specific duration?

Term life insurance is specifically designed to provide coverage for a predetermined period or duration, such as 10, 20, or 30 years. This type of insurance pays a death benefit to the beneficiaries only if the insured passes away during the policy term. If the insured survives beyond the specified term, the coverage expires, and no benefit is paid.

The primary feature of term life insurance is its simplicity and affordability compared to other types of life insurance. Premiums for term policies are generally lower because they do not accumulate cash value and are based solely on the likelihood of the insured person passing away during the term. This makes term life a popular choice for individuals seeking temporary financial protection, such as covering a mortgage, child education expenses, or other time-sensitive financial commitments.

Whole life, universal life, and endowment life insurance policies each have different structures and features. Whole life insurance provides coverage for the entire lifetime of the insured, as long as premiums are paid. Universal life insurance offers flexible premiums and death benefits with a cash value component that grows over time. Endowment life insurance involves paying out a benefit either upon the death of the insured or if the policy matures at a specified age, combining elements of both life insurance and savings.