To start on with, you must try to understand that life insurance falls into two very broad categories: Whole and term. The basic dissimilarity between term and whole life insurance is this: A term policy is life coverage only. In whole life insurance policy, as long as one continues to pay the premiums, the policy does not expire for a lifetime. As the term applies, whole life insurance offer coverage for the whole life or until the person reaches the age of 100. Your premium amount is guaranteed to remain level for as long as you live, even if the insurance company's costs rise. When you reach old age, your premium will not increase over the amount you paid when you started the policy.

The cash value build-up is creditor proof in most states which makes Whole Life Insurance a sort of double indemnity' policy by protecting your family should you die suddenly as well as protecting your family should you be sued or have to declare bankruptcy. If the time comes when you feel you are unable to continue making premium payments or you feel you have more insurance coverage than you need, but you don't want to surrender or take a loan against the policy, you have a number of alternatives. Based on the size of your cash value account, you could use your cash value to purchase what is known as reduced paid-up insurance, whereby your coverage amount is lowered and no further premiums are required. Or, you could turn the cash value into extended term insurance, which would provide the same level of death benefit you now have, but for a limited period of time.

Whole Life Insurance Advantages:

• The amount you pay for life insurance generally remains the same your whole life even as you get older and your health declines.
• Your policy cannot be cancelled apart from for loan absence or failure to pay premium payment.
• Your policy causes you to save money on a regular basis.
• The investment share of the policy has cash value.
• You can borrow against the cash value of your policy.
• You can cash in the policy at any time although there may be a surrender fee in the early year