How does term life insurance primarily differ from whole life insurance?

Term life insurance primarily differs from whole life insurance in that it provides coverage for a specific period, such as 10, 20, or 30 years. This means that if the policyholder passes away during this defined term, the beneficiaries receive a death benefit. If the policyholder outlives the term, the coverage ends, and no payout occurs unless they renew or convert the policy.

In contrast, whole life insurance is permanent and remains in effect for the lifetime of the insured, as long as premiums are paid. It also includes a cash value component that accumulates over time. This fundamental difference in the duration of coverage and features like cash value is what distinctly separates the two types of insurance policies.

The other options do not accurately describe the primary difference between the two. For example, term life insurance does not build cash value; it is typically more affordable compared to whole life insurance due to its temporary nature, and whole life insurance covers death from any cause, not just natural causes.