Life Insurance Education Center
Understanding the difference between term and whole life is the first step. This page walks you through the practical questions that help identify which type — and how much coverage — actually makes sense for where you are in life right now.
Decision Framework
There is no single correct answer for everyone. But these key questions, when answered honestly, point clearly toward the type and amount of coverage that serves your family best.
Be specific. Are you replacing income if you die during working years? Paying off a mortgage? Covering funeral and final expenses? Leaving something to your children? Each purpose points toward a different type of coverage.
If your need is tied to a specific time window — until your mortgage is paid off, until your children are self-sufficient — term life is a natural fit. If your need has no expiration date, permanent coverage is the logical choice.
Age and health are the two biggest drivers of premium cost. The younger and healthier you are when you purchase, the lower your premium — and it locks in at that rate. If you are older or have health concerns, whole life final expense policies with simplified or guaranteed issue underwriting may be your most accessible option.
A policy you cannot sustain is a policy that lapses — and a lapsed policy provides no benefit. It is better to have a smaller policy you can consistently pay than a large policy you abandon. For a given budget, term life typically provides a much larger death benefit than whole life.
If you have a spouse, children, or others who depend on your income, income replacement is a critical need — and term life's larger death benefit at a lower cost is well-suited for this. If you are retired and no one depends on your income, the income replacement argument for term becomes less relevant.
Many people have group life insurance through an employer — typically 1–2 times their annual salary. This often disappears when you change jobs or retire. If you have no coverage at all, any coverage is better than none. Start with what fits your budget today and review as your situation changes.
Life Stage Guide
Your insurance needs are not static. What made sense at 30 may not be the right coverage at 55. This framework is a general guide — every person's situation is unique.
Coverage Amount
The right amount depends on what you're covering and why. Here are three commonly used methods for estimating an appropriate coverage amount.
A widely used rule of thumb: multiply your annual income by 10 to 12 to arrive at a death benefit that could theoretically replace your income for a decade or more. Most commonly applied to term life for younger workers with dependents.
Add up: all outstanding debts, your income multiplied by years until your youngest child is independent, your remaining mortgage balance, and estimated education costs for your children. Produces a more specific and personalized estimate.
For those focused solely on covering end-of-life costs, a policy sized to cover current burial or cremation costs plus a small buffer for related expenses is the practical target. Based on 2026 Southeast averages.
Before You Buy
Before committing to any life insurance policy, work through this checklist. These are the questions a good insurance producer should help you answer.