what is the diff. between term life,whole life and universal life insurance.?

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1. term life is for a set period of time- like 10 years. Whole life is for your entire life and I'm not sure about the universal part.....
2. Term Insurance guarantees a time period that the premium stays level. Whole life guarantees that the premium never goes up and has a cash value to the account. This means that at some time in the future you can cash the policy in. There are several varations of universal life. A standard UL policy is based off of interest rates. A variable universal life policy uses a sub-account with mutual funds. Here is more info on permanent life insurance: http://www.findlocalinsurance.com/permlife.html
3. Term is cheaper than Whole life. Term gaurantees a death benefit for a certain period of years. Whole life is more expensive. It gives you a death benefit and builds cash value. Dont let whole life insurance trick you, though. The cash value can be borrowed from during the life of the policy, but you have to pay it back with interest or the loan will be taken out of the face value still with interest at the end of the insurance period. You will not get both the death benefit and the cash value. The policy can be cashed in when you reach a 100 years old, but then their is no death benefit. Or if you die before 100 years of age, the beneficiary will get the death benefit but not the cash value. With term you can buy cheap insurance with a high death benefit and use the rest of the money you would be paying into your whole life policy and invest it in something like a mutual fund. Universal whole life combines term with a tax deferred savings plan. Payments, death benefit, and cash value growth are all flexible. Insurance companies make more money off you with a whole life policy.
4. Seems the term "financial advisor" is being thrown around pretty loosely these days. How can you "advise" someone you don't even know?! And for the record, there are universal life policies that allow you to choose whether or not your beneficiaries receive just the death benefit or the death benefit + the cash value. Actually, they are quite common. The difference between whole life and universal is that the premiums are flexible with universal. You can pay more into it if you want, or if you have sufficient cash value, skip premium payments. Again, contrary to what some "financial advisors" say, with universal, or variable universal, life policies you can take a tax-advantaged loan and you don't have to pay it back.
5. Term insurance is pure insurance and carries with it the cheapest premium. Just that. It is usually purchased for a certain period of time. If you don't die in that period you don't get any money back. If you still need insurance after that time period, you need to start a policy all over again. The price is a lot higher because you are older. A number of term policies are not renewable and therefore you need to requalify all over again. Whole Life insurance is a form of permanent insurance. It carries a high price than term, but the price stays the same for the duration of the policy and the policy can never be taken away from you. Different policies have different payment periods. Some can be paid up after 20 years, some ate different ages, i.e. age 65 or age 85, or some are payable for life. Whole life policies have a cash value to them (Some also pay dividends also). The policy may be surrendered at any time or may be borrowed from. If you take a loan from the policy, there is interest charged to you and while there is NO requirement to pay the loan back, if you die, the amount you borrowed is subtracted from the death benefit. Universal Life insurance is like a combination of both as thus the premiums are usually in between the other 2 policies. Universal is also a permanant life insurance policy. How it works is that the insured pays the premium. That premium is immediately put into a fund earning interest. From that fund, the company every month withdraws enough premium to pay for 1 year term insurance. The older a person gets, the more the company withdraws because the cost of insurance is higher. This policy is usually paid for life, although it can be paid up early. The policy may be borrowed on like whole life insurance, but the interested paid is usually credited back to your policy. With Universal, you can elect to have paid just the listed death benefit, or the death benefit and any cash value upon your death. There is a version of Universal Life called Variable Universal Life. With this policy, the cash value can be invested into "mutual fund type" investments, with the insured directing where he what he wants the money invested in. There are higher fees associated with this policy but there is also potential for greater return. With both Whole and Universal policies, the cash value grows tax defered. There is no right answer which type is best. Neither one is better than the other. Each product has their own characteristics and each personal has their own individual needs. NEVER listen to anyone who tells you to only buy either one or the other. Most people will carry a mixture of term and permanent. The best thing a person can do is consult with a financial professional and have a needs analysis done.