In contrast to term insurance, permanent insurance doesn’t have an expiration date and is basically guaranteed to pay off unless you stop paying. It also costs a whole lot more because of that near guarantee. It covers more things and it allows you to do some interesting things like borrowing money from it.
Your coverage amounts will be much lower with this type, but these types of insurance are also very much more likely to pay out something rather than nothing. That is the tradeoff.
These types of insurance have an investment portion to them and the insurer pays you to own them. The amounts they pay you can potentially increase to the point where they pay your yearly premiums. That can be a pretty good deal. It’s even possible that they pay you more than your premiums and the extra can be used to increase the amount they pay your heirs when you die.
Most people don’t consider this type of insurance to be very valuable considering how much more costly it is to buy this as compared to term insurance for the same insurance company payout. It’s definitely worth considering, though.
It is possible to get combinations of both Permanent and Term insurance in one package. This is often referred to as blending. These are also worth considering.
The death benefit of permanent life insurance tends to start low and rise over time and it doesn’t get cancelled by the insurer when you get older. In contrast, the death benefit of temporary life insurance starts high and, at some point (usually before you die), your death benefit goes to 0. A blend of these two can help get you a moderate death benefit both early and late for a reasonable cost.