The main differences between whole-of-life assurance and term life assurance are:
- Coverage duration:
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- Whole-of-life assurance: Provides coverage for your entire lifetime.
- Term life assurance: Offers coverage for a specified term, such as 10, 20, or 30 years.
- Premiums:
- Whole-of-life assurance: Typically has higher premiums due to the guaranteed payout.
- Term life assurance: Usually has lower premiums since it only covers a set period.
- Payout:
- Whole-of-life assurance: Guarantees a payout upon death, regardless of when it occurs as long as premiums have been maintained.
- Term life assurance: Only pays out if death occurs within the specified term.
- Investment component:
- Whole-of-life assurance: Can include a savings or investment component, allowing the policy to build a cash value over time.
- Term life assurance: Purely insurance, with no savings or investment component.