When it comes to these types of insurances, it is important to describe three different involved parties: the insured (the person whose life the policy covers), the policyholder (the person who hires the insurance company and pays the premium (this can be the same as the insured person), and the beneficiary (the person who will receive the payment by the insurance company).
The most accepted classifications based on the purpose of the life insurance are:
Term Life Insurance
If the insured passes away before the end of the contract, the payment is guaranteed to be payed to the beneficiaries designated in the policy. If the insured is alive by the end of the contract, this is terminated without any compensation payment by the company.
Whole Life Insurance
If the insured is alive by the end of the contract, the corresponding payment is guaranteed to be paid to the named insured. Universal Life would fall into this category.
Universal Life Insurance
Just as with whole life insurance, individual universal life insurance protects you for life. Universal life insurance, however, offers the flexibility to adjust your premium and your death benefits.