No, term life insurance doesn't build cash value. A term life policy offers coverage for a set period and focuses on protection. If you're looking for long-term value, some convertible term life options let you switchto a permanent policy that does not grow in cash value over time.
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TERM LIFE INSURANCE Protection when you need it most with term life insurance
You can't predict the unexpected—but you can be prepared. A term life policy is one of the most cost-effective coverage options that helps you stay ready and protect your family for a set period of time.
Why choose term life insurance?
Term Life insurance is a simple, flexible policy that offers coverage for a specific number of years—often 10, 15, or 20—at a lower cost than permanent policies.1 It's a cost-effective choice for anyone navigating life changes and financial commitments, like raising a family or paying off debt. Plus, you can choose to extend your coverage to a permanent policy.2
What do I get with a term life insurance policy?
Whether you're just starting out on your own or looking for reliable financial support for your family, a term life policy can help you balance your short-term needs with long-term planning.
Guaranteed death benefit
If you pass away while your term life policy is active, your loved ones receive a tax-free payout to help cover funeral costs, bills, or everyday expenses.
Multiple lock-in periods
With term life insurance, the earlier you buy, the lower your premiums may be. Choose from level coverage for 10, 15, or 20 years—or opt for year-to-year flexibility with rates that adjust over time.
Convertible, portable coverage
Convertible term life gives you the flexibility to secure long term-protection2 without starting over. If your needs change, some policies allow you to convert your term policy to permanent coverage, even if you change jobs.
Tax advantages
In most cases, your beneficiaries won't owe income tax on the policy's payout, making term life insurance a tax-efficient way to support your family's future.
What are my term life policy options?
We offer two different types of coverage, so you can choose the one that makes the most sense for your needs.
Yearly renewable term
Temporary term life coverage with premiums that start low and increase annually.
Best for: People who need temporary coverage, like young professionals or those without employer-provided term life insurance.
Level term
Level term life insurance locks in consistent, predictable premiums for 10, 15, or 20 years. After the initial term ends, rates will typically increase if you choose to renew.
Best for: People who want predictable premiums and need coverage for a specific period of time.
Get started with term life
A New York Life financial professional can help you understand your options and find the right coverage for your needs.
Customize your term life policy with riders (add ons)
Spouse Paid-Up Purchase Option
If you die, your spouse can use the payout from your policy to purchase their own paid-up life insurance without a medical exam (a unique option from New York Life)3
Disability Waiver of Premium
If you become disabled and can’t make your regular payments, we’ll cover them for you until you’re recovered
Living Benefit
If you’re terminally ill, you can take out a portion of the death benefit early to help pay for treatment or other care you might need4
Common questions about temporary life insurance
Term life insurance is sometimes referred to as temporary life insurance and it can be helpful with short-term needs for financial protection. You can purchase term life insurance with a level premium period (such as 10, 15 or 20 years). At the end of that level premium period, premiums will increase each year thereafter. Term life is also convertible, meaning that it can be changed into a permanent policy for long-term life insurance protection. The initial cost for term life is generally lower than permanent life insurance, but the cost of temporary coverage increases over time (unlike permanent policies).
Term life insurance policies do not build cash value, so it is not possible to take funds out of them. However, a term life policy can be converted into permanent life insurance, which does build cash value that you can withdraw. Either type of policy provides a payout to loved ones in the form of a death benefit if the insured person passes away.
The right time depends on your personal situation. For example, if you have family members who depend on you financially, now is the time to consider term life insurance. It can replace some of your income for your loved ones if you pass away. You can learn more about all of your life insurance options when you connect with an agent.
Term life insurance covers you for a specific period of time–often somewhere between 10, 15 or 20 years, depending on your needs and the policy you choose. If you decide that you want something permanent, you can convert your term life coverage into a whole life insurance policy, which also accrues cash value that you can use during your lifetime.
Term life insurance is intended to provide temporary protection. If your policy expires during your lifetime, you do not receive a payout (also known as a death benefit). However, your agent can help you convert your term policy to a whole life policy (generally within the first ten years), which will provide lifetime protection and guarantees a death benefit for your loved ones.
Term life insurance is best for those who need coverage for a specific period of time during key milestones in life, like raising a family or paying off a mortgage. It's a great option for people who want flexibility and lower premiums.
There’s more than one way to protect the ones you love
COMPARE YOUR LIFE INSURANCE OPTIONS
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Remains level for a period of time you select, then increases over time |
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Always the same amount |
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Can be adjusted |
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Guaranteed minimum interest credited |
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Cash value growth subject to market risk |
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1Term life insurance offers temporary protection for a critical period of time and is generally less expensive than permanent life insurance.
2Term conversion guidelines and limitations, such as timing, may apply; for example, there may be a ten-year conversion privilege for some products and a five-year conversion privilege for others. See the product factsheet or speak to your agent for more details.
3Rider Insured’s Paid-Up Insurance Purchase Option in New York.
4Not available in every state. There is a cost to exercise this rider. Products and riders are available in approved jurisdictions and names and features may vary.
5Dividends are not guaranteed. Not all participating policy owners are eligible for dividends.
For select riders, the condition applies to the insured. See the product and rider fact sheets for details. In most jurisdictions, the form numbers are: Yearly Renewable Term (ICC22423-135P); Level Term (ICC22423-60P); Living Benefits Rider (ICC22423-498R); Spouse’s Paid-up Insurance Purchase Option (In New York, “Rider Insured’s Paid-Up Insurance Purchase Option”) (ICC22423-375R); Disability Waiver of Premium Rider (ICC22423-235R); Policy Purchase Option Rider (ICC22423-413R); State variations may apply. SMRU 5641351
Term life insurance is issued by NYLIFE Insurance Company of Arizona (NYLAZ), a wholly owned subsidiary of New York Life Insurance Company (NYLIC), except in New York, where it is issued by NYLIC. NYLAZ is not authorized in New York and does not conduct insurance business in that state.