How Much Will Life Insurance Payout? 
Life insurance policies pay out what is called the `` death benefit '' . When you buy a term policy , that is the `` face amount '' of the policy . The entire face amount of term insurance is paid to the beneficiary . When you buy permanent insurance , the death benefit may be reduced by the policy owner having taken out a loan on the policy , or using some of the face amount as a living benefit . Conversely , the death benefit for permanent insurance might be higher than the original face amount , due to the policy 's growth . 