Term Life Insurance
The Affordable Plan for Life and Family
Term life insurance is the most affordable option for anyone who needs to provide a future course in the event of their untimely demise. It's called "term life insurance" because it lasts for a defined term at the time of the purchase. As long as the premiums are paid each month, the beneficiaries are paid the full death benefit if the policy holder dies during that period.
Term life insurance costs less than permanent life insurance policies like whole life and variable life. The reason is because the policy accrues no cash value (except in the case of Return of Premium Term Life Insurance, where you can get a full refund for all the premiums you've paid at the end of the policy period). Another reason is because the policy is guaranteed to end within a certain number of years. The insurance company hopes this will be before the policy holder dies.
What Will Term Life Insurance Pay
Mortgages, education, cost of living, or burial costs. Term life insurance is typically set up to pay for all the things that the regular "bread winner" of the household would pay. You can also use it to pay the taxes involved in a estate inheritance.
You can purchase term life insurance policies for terms of one to thirty years. The most popular option is for fifteen years. At the end of the term, the policy ends. Some policies come with a guaranteed renewal rate, so you can purchase a new policy when the old one ends. The rates will obviously be higher because of the age increase.
Will I Need a Medical Exam to Qualify for Term Life Insurance
In most cases, companies require policy holders to undergo a brief medical exam before qualifying for term life insurance. Insurance companies try to make it as simple as possible. Some companies will even send a qualified nurse to your home for the exam.
It might be possible to bypass the exam and receive immediate coverage depending on your age. You can expect to pay more for this kind of term life insurance, and if you have serious health problems, it might be unavailable. Remember that insurance is something you buy ahead of time. You couldn't make an accident claim on an auto insurance policy if the accident happened before you purchased the policy. In the same way, if you have serious health risks, term life insurance might be much more expensive or unavailable.
What Else Should I Know About Term Life Insurance
Some policies provide you with accelerated benefits options. They'll pay you benefits before death if you have a terminal illness. This would cost more, but in some cases, the added protection is worth the money.
Sometimes you can lower your premiums by presenting your health profile before purchasing a term life insurance policy. Show the company that you have less risk of dying than an average person.
Term life insurance isn't for everyone. But if you can't afford an investment insurance, but still want to protect your family if you die at an early age, term life insurance might be the answer.
Talk to your Insurance Agent to ensure Term Life Insurance is right for you!