Term life insurance offers temporary coverage for a specific period of time, such as 10, 20 or 30 years. As long as you keep up with your premium payments, your insurer will pay a sum of money to your life insurance beneficiaries if you die during the term.

Unlike whole life and other types of permanent life insurance that may last your entire life, term life insurance coverage typically expires when the term ends. This means that if you outlive your policy, your beneficiaries won't receive any money. If you still need life insurance, you may be able to renew your policy, convert it to permanent coverage at a higher premium or buy another policy.

Term life doesn’t build cash value that you can borrow against, like permanent life insurance does. This is one reason term life is cheaper than whole life. Term life purely provides insurance, and with whole life, you're paying for longer coverage and the ability to grow the policy's cash value.