Explanation
Term insurance provides pure protection for a defined period, while combines lifelong coverage with features. depends on budget, time horizon, and whether the client needs coverage that extends beyond income- years.
Example
A young family may choose 20-year term to cover mortgage and child-rearing years. A business owner planning liquidity may prefer permanent coverage to align with long-duration obligations.
Common mistakes
A common mistake is selecting only for investment language without confirming protection needs. Another is underestimating renewal costs on term policies when future insurability is uncertain.
Summary
Start with risk objective first, then choose term or permanent based on duration, affordability, and flexibility requirements.