Life insurance can be an expense you may not want spend much time thinking about. However, leaving your beneficiaries with financial baggage that you may have created can be more troublesome. Wouldn’t it be great to deal with life insurance issues while you’re healthy instead of waiting until something happens that forces you to pay attention to the situation? Should some unforeseen circumstance take you from the people close to you, don’t you want to be able to have a little comfort, knowing that your beneficiaries may not have to struggle financially?
In its most basic sense, you generally have two types of life insurance choices to pick from: term life insurance and permanent life insurance and, with the simplest and potentially cheapest form of life insurance generally being the term life variety. Term life insurance usually has smaller premiums than whole life or permanent life insurance policies because with term life insurance, the coverage duration of the policy is for a fixed period of time. Term life insurance benefits are usually paid out if you were to pass away during the period of period that your policy is active. If you were to pass away after the term of the policy has passed, no benefits are typically paid.
Term Life Insurance Basics
A look at term life insurance basics may get you a better understanding of what a term life insurance policy is. Term life insurance can provide you with life insurance coverage for a set time period or team. Your premium payments for any term life insurance policy may be fixed, remaining the same for the term’s duration. You may choose various options to include in your individual term life insurance policy and chose terms ranging in time from 10 years, 15 years, 20 years and in some cases, even 30 years. Term life insurance coverage, being less expensive than permanent life insurance, is favored by people who know that they need or want life insurance coverage only for a specific period of time.
Your Term Life Insurance Guide
Within term life Insurance policies there are generally five basic types of term life insurance plans, each offering an option that their name may imply.
(1) Level Term Life Insurance. Providing for a set or fixed amount of coverage, with premiums generally remaining stable over a certain time period, level term life insurance ranges in duration from ten (10) to thirty (30) years with offerings of time periods in five- to ten-year increments (i.e., 10-year term, 15-year term, 20-year term, etc.). Some level term insurance policies may also set the term at a specified age (typically age 65).
(2) Renewable Term Life Insurance. Continuing coverage for a specified term (or terms), renewable term life insurance usually is purchased in increments of one (1) or five (5) years. The advantage of a renewable term life insurance policy is that you can generally renew the policy without being required to undergo a yearly medical exam or provide the insurance provider with evidence of good health for your policy to be renewed each year. Renewable term premiums for the policies are typically based on either your current age or your attained age.
(3) Decreasing Term Life Insurance. Providing insurance benefits that gradually decrease in value over the term of your coverage, decreasing term life insurance premiums may remain stable; however, the value of coverage decreases in value over time. A popular choice of term life insurance coverage for policyholders who would like to use the benefits to pay off mortgages, decreasing term life insurance coverage decreases as your monthly mortgage payments decrease.
(4) Convertible Term Life Insurance. Allowing you to exchange a term life insurance policy for a permanent, or cash-value policy without generally having to undergo a medical exam or provide evidence of insurability, convertible term life insurance policies are often purchased by younger customers because of their inexpensive premiums. These policies, while less expensive than permanent life insurance policies, provide the same basic general insurance coverage without the hefty price tag. With a convertible term life insurance policy, policy holders may covert or upgrade coverage to a permanent or cash-value term policy should term life policy not provide adequate protection as you age without penalties for starting over in the life insurance application process.
Unfortunately, converting a term policy to a permanent life insurance policy will generally result in higher monthly premiums. And, you’ll want to make sure you allow an appropriate amount of time to convert your term life policy to a permanent life insurance policy. Typically the amount of time allowed by insurance carriers to convert a policy is shorter that the duration of the term coverage; so make sure you get in touch with your agent in a timely manner when you think you may be ready to convert your policy.
(5) Return of Premium Term Life Insurance. Generally providing a means for the return of premiums paid, when the policy term ends, minus fees, administrative charges, and other costs, a return of premium term life insurance policy requires you to keep your policy in force until the end of the term or forfeit the return of your premium benefit. With a return of premium term life insurance policy, if you do not file a claim by the policy term expiration, you can recoup some of your expenses. In other term life insurance scenarios, there is no refund of monthly premiums when your term expires. With significantly higher premiums than other term life options, return of premium term life insurance isn’t quite as economical as other term life insurance options.
Term Life Insurance Guide to Purchasing Your Term Life Policy
Determining what type of term life insurance plan you would like to purchase is the biggest hurdle in your research once you have decided to procure that coverage. Your next steps should be:
(1) Research companies in your state that may offer the options in term life insurance youwould like and to get term life insurance information.
(2) Get a medical exam if you think you will be required to do so from your health insurance company.
(3) Get life insurance quotes from several term life insurance companies. You can easily get quotes right here on everydaylifeinsurance.com by filling out our quote form. A courteous knowledgeable term life insurance professional is available to help you with your quote.
(4) Complete the application for your term life insurance policy by thoroughly answering all questions to eliminate a delay in the processing of your application.
(5) Once you receive your policy documents, read them carefully before you sign them to make sure that you have the life insurance coverage you desire at an affordable price.
(6) Sign your life insurance policy, pay the policy premium, and relax knowing that your loved one’s future is now secure.
Get Your Free Term Life Insurance Quote
Now that you have decided to protect your family with the purchase of term life insurance coverage, contact us for your free, no-obligation quote for term life insurance.