The types of life insurance, in plain terms.

The insurance industry uses complex terms to sell expensive policies. We break down exactly how term, whole life, and IUL work.

Understanding Term Life Insurance for Veterans

Term life insurance is pure protection. You buy a policy for a specific length of time, usually 10, 20, or 30 years. If you die during that term, your family gets the money. If you do not, the policy ends.

Because it only pays out if you die during the term, it is very affordable. This lets you buy a large amount of coverage to protect your family while you are paying off a mortgage and raising children. Not sure how much to carry? See how much life insurance you need.

Whole Life Insurance

Whole life insurance covers you for your entire life, as long as you pay the premiums. It also includes a "cash value" component that grows slowly over time.

Because the insurance company knows they will eventually pay the death benefit, whole life is incredibly expensive, often 10 to 15 times the cost of a term policy for the same amount of coverage.

Compare term vs whole life in detail.

Indexed Universal Life (IUL)

IUL is a type of permanent insurance often pitched as a way to grow wealth. The cash value is tied to a stock market index. These policies come with high fees, caps on your returns, and complex rules.

Life insurance is not an investment. It is risk protection. For most veterans, mixing investing with life insurance tends to mean higher costs and weaker results than keeping the two separate.

Read the truth about IUL policies.

The Honest Case for Term

We believe in the "buy term and invest the difference" principle. Instead of paying thousands of dollars a year for a whole life or IUL policy, you buy an inexpensive term policy to protect your family.

You then take the money you saved and invest it separately, on your own. Over 20 or 30 years, the goal is that those savings grow while your term policy covers your family. By the time the term ends, the idea is that your mortgage is paid off, your kids are grown, and your savings carry the load that insurance used to.

Learn how the buy-term-and-invest principle works.

For veterans comparing options

If you are weighing these against a VA option, see VGLI vs term life and the full picture in veteran life insurance, explained. For spouse and child coverage, look at life insurance for military families.

Frequently Asked Questions