Permanent Life Insurance Has Much Lower Net Cost.


Term Insurance or Permanent Insurance? Which Should You Own?

Watch out for the dangers of Term Insurance.


Do you want to provide a guaranteed, tax-free benefit for your family or business, regardless of how long you live? Then you should own Permanent Insurance.

The people pushing term insurance use a misleading slogan “buy term and invest the difference”. The problem is:

Nobody invests the difference!

If you want to protect your family for your entire life, a permanent policy is your only option.

If you want a better return, look at permanent coverage. The net cost is much lower than term insurance.

The Dangers of Term, Look at the Math: A male 35 will pay $950 annually for $1,000,000 of term (for a female, a little less). The 10-year net cost of this policy is a LOSS OF $9500Over 30 years, the policy will have a net loss of $28,500. The term policy will lapse at age 65 with no value. If this person is healthy, he has 20 more years to live, using today’s projections. If the person is unhealthy, he will be unable to get life insurance or it will be un-affordable. Millions of people over 60 today cannot qualify afford what is available, if anything.

The Advantages of Permanent: On the other hand, the same 35 year old can buy a permanent policy for $9525. The premium is guaranteed to stop at age 65. The 10-year net cost of this policy is projected to be a GAIN OF $2721. The 20-year net cost is a GAIN of $97,816 and the 30 year GAIN is $343,059.

Over 30 years, the term policy has a negative cost of $28,500. The permanent policy has a guaranteed gain of $44,751. The projected gain, using the current dividend scale, is a stunning $343,059. Would you like to see a simple presentation?

The permanent policy can remain inforce as long as you want without any new medical information. The equity in the policy can be tapped at anytime. Many permanent policies offer Living Benefits for chronic health emergencies. Permanent policies may have secondary market value after age 70.

This net cost analysis is similar whether you are 30, 45, 50 or 60+.

Why doesn’t every life insurance buyer own a permanent policy?

The number one reason young people select term insurance is affordability. Many young life insurance buyers do not have the necessary cash flow to purchase permanent life insurance, and that forces them to purchase term. In too many cases however, the term policy is not replaced with permanent coverage when it is affordable. The right professional working in your best interest should be stressing the importance of replacing the term policy. Term insurance is the right product only if your need for coverage is temporary.

Most young people underestimate their desire to have life insurance later in life. People over 50 want insurance for their spouse, children or grandchildren.

If you have not looked at the advantages of Permanent Life Insurance recently, you will be surprised at the low premiums and low net cost. The entire process, from quotes to underwriting, can be done online and, in many cases, there is no medical exam at all.

Should You Own Permanent Insurance?

  • The net cost of permanent life insurance is much better than term.
  • Does not expire, is there when you need it most, one policy for life.
    • Consult with an experienced insurance professional to get a fully customized policy.
        • Secondary market value. A permanent policy can be sold for cash if you do not need or want the policy after age 70. You cannot sell a term policy in the secondary market. It has no value.

The following video speaks to the virtues of permanent life insurance.


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Also published on Medium.


Ted Bernstein

Dedicated to helping people create the ultimate retirement security and protection plan to safeguard their families and businesses. I stress guaranteed income solutions, indexed annuities and state of the art wealth preservation strategies. As the innovator of life insurance products without commissions, my recommendations are impartial, objective and always in the best interests of my clients.

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