When buying personal life insurance, you’d be introduced to Term life insurance, Whole life insurance, Endowment/savings plans, as well as Investment-linked policies.
Each product type has its purpose, advantages and disadvantages.
So what is Term life insurance?
Term insurance is life insurance that provides insurance coverage only for a fixed period of time. An example of term insurance is the Dependants’ Protection Scheme.
Buy term insurance if you only need protection coverage for a fixed period of time. For example, if you want to be covered until your youngest child completes university or is financially self-reliant.Understanding term insurance, MoneySense
Term life insurance, also known as pure life insurance, is a type of life insurance that guarantees payment of a stated death benefit if the covered person dies during a specified term. Once the term expires, the policyholder can either renew it for another term, convert the policy to permanent coverage, or allow the policy to terminate.Term Life Insurance, Investopedia
Term insurance is a policy that would cover you for a fixed period. The policy will pay out an insured sum of money in the event of death or terminal illness of the policyholder.How to Understand A Term Insurance Illustration, DollarsAndSense.SG
In brief, Term life insurance:
- Provides purely insurance protection coverage
- For a fixed period of time
- Hence, premium tends to be lowest amongst the different insurance product types