What do you call insurance that covers a specific period of time?

Term life insurance is designed to provide coverage for a specific period of time, typically ranging from one year to 30 years. This type of insurance is straightforward and affordable, making it an attractive option for many individuals needing temporary coverage, such as to cover a mortgage or provide for dependents during a critical financial period.

Unlike whole life, universal life, or variable life insurance, which are permanent types of life insurance providing lifetime coverage and potential cash value accumulation, term life insurance does not build cash value. Its primary function is to offer a death benefit to beneficiaries if the insured passes away during the term. If the term expires and the insured is still living, there is no payout, and the policy typically terminates unless it is renewed or converted to a permanent policy.

The simplicity and focus on providing death benefits for a limited time, without the complexities of investment components or cash value, define term life insurance as a distinct product suited for specific needs.