A term base life insurance policy provides short-term, or temporary, coverage for the duration of a time period, or term, to the insured. The term usually ranges from 1 to 30 years. The cost basis, or premium, and death benefit are guaranteed level for the duration of the contract. The living benefits are mandatory, and include renewal and conversion. The policy can be renewed during the duration of the term, up to the end of the renewal period or before the maturity of the contract. The policy can also be converted from temporary to permanent coverage, from the start of the conversion period to the end. A term life insurance policy does not provide living benefits such as a cash value savings account based on a guaranteed fixed interest rate, credited floating interest rate, or mutual fund investment return, nor is the policy participating, or dividend-paying. This type of base policy is beneficial to an insured in need of affordable coverage and a policyowner who holds a conservative tolerance towards financial risk.

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