Group coverage provided by an employer is helpful, but it typically replaces only one to two times your annual salary—and is likely to end if you leave your job. An individual policy could provide lasting protection regardless of changes in your career. Two basic types of life insurance Evaluating Life Insurance Needs Would your death cause a financial hardship for someone else? If so, you might consider buying life insurance. Term life insurance offers a death benefit for a specified time period, such as one to 30 years. It tends to be more affordable, especially for younger individuals, but premiums rise with age. Permanent life insurance typically offers lifetime protection, regardless of your health, as long as you pay the premiums to keep the policy in force. A portion of each premium goes into a cash-value account that accumulates on a tax-deferred basis. Youmay be able to borrow against the cash value during your lifetime to help pay for retirement, education, emergencies, or other needs. Loans and withdrawals from a permanent life insurance policy will reduce the policy’s cash value and death benefit. 1 2
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