What is the difference between level term and decreasing term life insurance?

Question

Jim Mentink · Accepted Answer

Level term features a consistent premium payment with a death benefit that also stays consistent.  You make the same payment for the term and if you pass, the full death benefit is available.
Decreasing term features a consistent premium payment with a death benefit that *decreases* over time.  Usually these are used with, for instance, a mortgage that decreases over time.

Dean Chiapetto · Answer

Level Term is exactly that, everything stays level, the premium and the death benefit.
Decreasing Term the premium stays the same and the death benefit decreases over the term of the policy. 
Level Term is used to cover all your expenses now and for the length of the term.
Decreasing Term is used to cover loans like mortgages and car loans. The idea is that as you are paying off the loan you need less and less coverage. These policies are usually cheaper than level policies.
Speak with a qualified broker.
Brokers Make a Difference!

Joe Zanni · Answer

**Level term life insurance** keeps the **death benefit the same** for the entire term.

**Decreasing term life insurance** has a **death benefit that goes down over time**, usually while the premium stays the same or close to the same.

## Level term

Example:

You buy a **20-year $500,000 term policy**.

If you pass away in year 2, your beneficiary gets **$500,000**.
If you pass away in year 19, your beneficiary still gets **$500,000**.

Level term is commonly used for:

* Income protection
* Family protection
* Mortgage protection
* Children’s future expenses
* Debt protection

## Decreasing term

Example:

You buy a **20-year decreasing term policy** tied to a mortgage.

In the early years, the policy may cover close to the full mortgage balance. Over time, as the mortgage balance goes down, the life insurance benefit also goes down.

Decreasing term is commonly used for:

* Mortgage protection
* Business loans
* Debts that shrink over time

## Main difference

| Type                | Death benefit       | Common use                  |
| ------------------- | ------------------- | --------------------------- |
| **Level term**      | Stays the same      | Family income protection    |
| **Decreasing term** | Goes down over time | Mortgage or loan protection |

Dina Todd · Answer

Level term insurance is an insurance that your premiums and the face amount stay the same during the term of the insurance policy. A decreasing term life insurance means the face amount decreases during the policy period. This is usually a mortgage insurance policy designed to cover in the event one or both insured passes away before the mortgage is paid off.

Answered by Dina Todd on June 27, 2026

Broker Licensed in NC

Answered by Dina Todd Life Insurance Agent

Vicki Farley · Answer

With the Level Term, the premium amount is set higher, so that the premium and the death benefit remain level throughout the term years of the policy, 10 years, 20years, or 30years, for $XX/month. Making budgeting easier. With a Decreasing Term, the premium will remain at a level amount, but the face value/death benefit, will reduce throughout the term years of the policy. $500,000/through years 1-10, $300,000/through years 11-20, $100,000/through years 21-30, policy ends. Thus allowing a lower monthly premium over the term years of the policy, in comparison to a Level Term. (Note: the amounts given are for example only.)

Answered by Vicki Farley on August 7, 2026

Agent Licensed in IL, AL, AZ, IN & KY

Answered by Vicki Farley Life Insurance Agent

Lt Col Tim Brown · Answer

Level term, the death benefit remains at a level amount of coverage the entire length of the contract.  You buy various terms or lengths of time, i.e., 10 yr, 20 yr, etc.  

Decreasing term plans would be used, say to cover a mortgage.  An example: if you bought a home on a 30 yr loan, as the mortgage decreased in amount owed over time, the face amount of the death benefit would decrease along with it.  

That's it. 

Lt Col Tim Brown 
Insurance Services of KY and TN Inc. (In 14 states now). 
I do life, Medicare plans, investing, hospital plans, dental vision hearing and critical illness plans.

Michael McGarrigle · Answer

Level term has a level death benefit whereas decreasing term the death benefit decreases over the period of time.  We typically use level term products rather than decreasing term.

Mark Schwarz · Answer

Level Term is premium stays the same as well as the coverage amount thru the life of the policy.

Decreasing Term is where the premium remains fixed but the coverage amount decreases. The payout decreases over time. People get a better rate and the amount coverage needed in time decreases. You may have a debit like a home that the insurance will be used help pay off.  Your coverage decreases over time because your debit decreases as well.