Types

• There are two types of term life insurance: level term and decreasing term.
  
  

Terms

• Term life insurance policies can be purchased for one to 30 years.
  
  

Advantages

• Term life insurance is the simplest kind of insurance to buy, and is less expensive than whole life, universal or variable life insurance. Policies can be bought in large amounts for low monthly premiums.
  
  

Disadvantages

• Term life insurance policies don't build cash value, aren't very flexible and don't offer a lot of options. Once a term policy expires, a new one can be purchased or the same one can be renewed at a higher cost. Most policies require a medical exam to qualify. Smokers and those with pre-existing medical conditions pay higher premiums.
  
  

Potential Insured

• Term life insurance is for families with children or a spouse who doesn't work, or for people who are between jobs. Single people without dependents can buy term life insurance to cover funeral expenses.