25 Mar Term Life Insurance
The most common form of life insurance. It is temporary life insurance coverage because it pays a death benefit to the person or persons designated as the beneficiary if the insured’s death occurs within a specified period (known as the “term period”) The time limit is usually -10/15/20/30 years. At the end of that time, the policy expires. The policy pays a death benefit only if the insured dies during the term. No cash value accumulates in the policy, so at the end of the term, the insurer owes no payment or refund to the policy owner.
It has the lowest premiums of any type of insurance.
It does not have a cash value. The absence of a cash value means that, for any face amount, term life costs less than permanent life insurance at just about any issue age. This makes term life especially popular and suitable for relatively temporary financial protection needs (e.g., while raising children, paying a mortgage). Over time, however, the premiums for term life insurance tend to increase to reflect the increasing mortality associated with advancing age.
However, many policies can be converted to a permanent policy without any additional underwriting .
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