How does whole life insurance differ from term life insurance?

Whole life insurance is designed to provide coverage for the insured's entire life, as long as the premiums are paid. This means that unlike term life insurance, which only covers the insured for a specific period (e.g., 10, 20, or 30 years), whole life insurance guarantees a death benefit whenever the insured passes away, no matter when that occurs. Additionally, whole life policies often have a cash value component that accumulates over time, which can be borrowed against or cashed in, adding a layer of financial security and investment beyond just the death benefit.

In contrast, the other options highlight misconceptions or inaccuracies about whole life insurance. For instance, premium costs can vary significantly, and whole life insurance often comes with higher premiums than term life insurance because it covers the insured for their entire life and includes a savings component. Moreover, while whole life insurance can be complex due to its features, which include investment elements, it is not necessarily designed to be simpler than term life insurance. Lastly, whole life insurance is not limited to seniors; it is available to individuals of various ages, making it a suitable option for many throughout their lives.