Term life is usually the least costly life insurance available because it offers a benefit for a specific time and provides only a death benefit. Term life insurance is like renting a home. You have a roof over your head, a place for your stuff, it is cheaper than owning (whole life).

Mortgage protection is another name for term life insurance, the only difference is its purpose. This is term life insurance that homeowners specifically get to pay off their mortgage. Some homeowners want to get insurance for the entire loan balance, some want to insure a percentage of the loan. Both are good choices, but it depends on your goals, your budget and other factors in your life.

Whole life insurance is a permanent insurance policy that pays your beneficiaries a specific amount upon the death of the insured. Because the insurance policy also builds up a tax-deferred cash value over the life of the policy, the policy holder can borrow cash from their life insurance policy.

You can use the cash value that is built up to pay your premium if you are suffering financial difficulty or if you just need a loan. As long as the premiums are paid as agreed, whole life insurance covers you for life, unlike term life insurance which provides coverage for a set period of time, between 5-30 years. There are some whole life policies that give you the option of returning all of premium that you have paid if you live till a certain age.