Two types of Life Insurance.

1-Peremanent life insurance- This type of life insurance you buy when you want to be guaranteed that the policy will be inforce when you die. This type will not expire after a 10, 20 or 30 year limit. Conceptually, you may want to consider this similiar to buying a home. Where the cost of the mortgage would typically be higher than the cost of renting an apartment.  With permanent insurance there is an equity portion of a permanent policy similiar to the equity buld-up in a home. The equity is called cash value.  This cash value is best used for long-term savings as there could be surrender charges if you cash in your policy within an approximate 15 year period. The cash value does accumulate tax-deffered. The type of interest you receive varies from year to year and by type of permanent insurance. I suggest you consider this after you have started to purchase your home, have an emergency fund established, saving money in your retirement plans and you have plenty of discretionary funds available each month. Term insurance is great for most of your insurance needs however permanent insurance can be extremely valuable in the long run.

2-Term Insurance- This type of insurance is purchased for a specific period of time. The premiums are gauranteed not to increase during that time period. Most common plans are 10, 20 and 30 year term periods. There are some small variations of the type of term plans available.  These policies do a great job insuring the highest death benefits for the lowest costs during that time period. However, these plans are not a long-term solution to have a policy inforce in your golden years beyond your 70's. Some policies maybe convertible to a permanent policy without a medical exam. This is typical as long as the time period has not run out.

A combination of permanent and term life insurances is common once your cash flow is very strong.