The cost of life insurance varies widely based on age, gender, smoker status, and health history. Generally, insurance cost less for a younger person and increases with each year of age.

The main types of life insurance are cash value life insurance and non-cash value life insurance. Within a cash value policy, there are three sub-types: guaranteed cash value only, variable cash value only, and both guaranteed and variable cash values.

It is best to purchase life insurance when you’re young. This is for two reasons: 1) the younger you are, the lower the premiums are, and 2) to qualify for insurance, you must be of suitable health to be covered. We are typically healthy when we are young and as we age, people’s health declines at varying rates. When you get insurance while you are young, you can keep the insurance even if you become unhealthy. If you wait until you are unhealthy, it may be too late.

You can withdraw money from your life insurance policy if the policy you purchased has a cash value. A cash value life insurance policy allows you to allocate a portion of your premium into a tax-deferred investment account that’s accessible throughout your lifetime. Not all insurance policies have a cash value component, so it’s important to buy the right kind of life insurance that will fits your needs.

It depends on why you purchased the insurance in the first place. If the purpose is to pay off a debt in the event of your death, such as a mortgage, then a non-cash value policy might be the best option for you – it offers the lowest short-term cost and can easily satisfy all your needs. If the purpose of the insurance is to provide your estate with liquid cash to pay estate tax at your death, then a cash value policy might be the better option. It offers increasing death benefits, can be paid up, and may be more economical over the long term. If the purpose is to assign the policy as collateral to secure a loan, then a cash value policy is the only option.

Some non-cash value policies can be set up to expire at a certain age or after a certain number of years while others can be kept for your whole life and expire at death when death benefit is paid out. If your policy expires, you can re-apply again or transfer to a cash value life insurance plan.

If you cancel a cash value insurance policy, you will get money back, and depending on how the policy is set up, you may even get back as much as you put into the policy or more.