Term life insurance is a form of life insurance that lasts for a set number of years — known as the term — before expiring. If you pass away before the term is up, your beneficiary — usually your family — receives a death benefit as a tax-free lump sum of money that can be used for funeral expenses, to pay bills, or for any other use.

Unlike whole life insurance and other forms of permanent life insurance, term policies don’t come with a tax-deferred savings component called the cash value. The cash value of a permanent life insurance policy accrues interest and can be used by the policyholder while they are still alive, while also usually making the life insurance policy costlier.

Due to its simplicity and affordability, purchasing term life insurance is one of the most popular ways to create a financial safety net. However, other types of life insurance can be a better fit for individuals with specific circumstances, such as lifelong dependents or a high net worth. Speak to one of our Life Insurance advisers to help you find the best way to determine what type of policy is the best fit for you.