Term insurance is basic

* Term insurance is basic, inexpensive coverage with premiums that increase over time and have no cash value.
* Consider a term policy that is renewable and convertible to whole life should your needs change.
* Whole life provides level coverage with level premiums. A portion of those premiums goes into tax-deferred savings.
* Check rates on whole life policies and compare them to other investment opportunities.
* Variable life offers control over your investments.
* Premiums on variable policies are fixed, but face value and the value of your investments can fluctuate.
* Universal life offers more investment options, but is highly sensitive to interest rate changes. Universal variable life is highly flexible, but offers no guarantees beyond the original face value.
* Insurance needs are based on income replacement and personal preferences.

Checklist

* Determine exactly how much money your survivors would need from life insurance in order to maintain long-term financial security.
* Decide whether you prefer term life insurance or a policy that also includes a savings feature.
* Shop around for the best deal, and read the policy before making a purchase. Don't assume you'll be getting benefits that aren't clearly spelled out.