What is the difference between term and permanent insurance policies?

Term and permanent insurance policies are types of life insurance policies. They both provide financial protection for you and your loved ones in the event of your death, however, they differ in how they work and the benefits they provide. Term life insurance policies provide death benefits for a limited amount of time (the “term”) usually between 10 and 30 years. Premiums are typically inexpensive, but you do not build any equity or cash value in the policy. When the term is up, so is the policy and you will need to either renew the policy or switch to a different type of policy. Permanent life insurance, on the other hand, is permanent, meaning that you are covered for your entire life. Premiums are more expensive than term life, but they build equity or cash value over time, which you may be able to access or borrow against. As long as premiums are paid, the death benefits are guaranteed (no matter how old the policyholder is). In South Carolina, all life insurance policies, regardless of the type, must be approved by the State Department of Insurance before they can be sold. All policyholders must be given a list of benefits, as well as a description of the types of term and permanent policies available.

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