How they differ
| Term | Permanent | |
|---|---|---|
| Coverage length | A set period (for example 10, 20, 30 years) | For life |
| Cost | Lower for a given amount | Higher for the same death benefit |
| Cash value | None | Builds cash value over time |
Whole vs universal
Permanent insurance comes in forms. Whole life has fixed premiums and a cash value that builds over time. Universal life adds flexible premiums and an investment component, with more variation in outcomes.
Who each suits
Term suits temporary needs such as a mortgage or raising children. Permanent suits lifelong needs, estate planning, or a goal of building cash value, and costs more.
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Book my free review →Frequently asked questions
What is the difference between term and permanent life insurance?
Term covers a set period at lower cost with no cash value. Permanent lasts for life and builds cash value at a higher premium.
What is the difference between whole and universal life?
Whole life has fixed premiums and a cash value that builds over time. Universal life has flexible premiums and an investment component with more variation.
Which is cheaper?
Term is cheaper for a given coverage amount, which is why many families start with it.
Can I convert term to permanent?
Many term policies include a conversion option that lets you switch to permanent coverage without a new medical, within set limits.
This page is for general educational purposes only and does not constitute personalized financial, tax, legal or accounting advice. Figures, limits and coverage ranges are illustrative and change over time - verify current terms before acting. Insurance and registered-account eligibility is subject to underwriting and government rules. Compensation is disclosed in writing before any application is signed. Neelesh Kumar is a Licensed Life & Health Insurance Agent regulated by FSRA - verify at fsrao.ca. © 2026 Wealthready · FinanceWithNeelesh · Kitchener, Ontario.