Term Life Insurance
is the lowest cost and simplest life insurance product available.
It provides protection for a limited number of years and the
death benefit is only payable if death occurs during that
term. If the insured survives the time period, the policy
expires and has no cash value. However, some policies have
a convertible feature permitting a policyowner to exchange
a term policy for a cash value policy without evidence of
insurability. Term is basically designed to provide a maximum
amount of protection for a temporary period of time.
most common type of Term insurance is Level Term. It has a
level (or constant) death benefit and a level premium for
a specified number of years. The most common are 1, 5, 10,
20, and 30 year terms. Another versionis Decreasing Term insurance.
It is generally sold with a level premium and a decreasing
death benefit. A variation of decreasing term is Mortgage
Life Insurance. This is designed to decrease at the rate in
which a mortgage balance decreases. Mortgage Life is typically
offered as a rider in connection with a cash value policy.
of Term Insurance
insurance is ideal for families where protection is needed,
but a minimum outlay of funds is necessary. Term also works
well as a supplement to cash value insurance. Another common
purpose of term insurance is to purchase it as protection
against debts such as mortgages, auto loans or education loans.
you have adequate retirement funds invested elsewhere and
simply want cheap, effective insurance without the cost of
the investment features of Whole, Universal or Variable Life
then Term Insurance may be for you!
the negative side, term insurance provides only temporary
protection, and there may come a time when an insured has
no protection after the term policy ends.
One more important note about Term Life Policies:
Term Life has no accumulating cash value and the older you
are when you are accepted the more it will cost, with or without
Whole Life conversion options at term end. As a result we
highly recommend that you make your Term Life application
as soon as you have reviewed the quotes and selected a policy.
Delaying can cost you money, and if you are selecting Term
Insurance that is likely one of the most important considerations.
with most reputable policies you will be required to take
a brief medical exam and this can be a little intimidating
however, you won't be any younger the next time you think
about it, and your application carries no obligation.
When you have completed the Quote Form you will be
shown a number of different carriers and options. Select the
one you would like, and then Apply!!
cancel existing coverage until the replacing policy has been
issued and you have verification of this! Always take copies
of all paprerwork whether electronic or physical and plan
to keep them for seven years after canceling a policy.
the forms entirely. If some question doesn't apply write "Not
Applicable". Application forms are frequently returned
due to incomplete information. Make sure you know what you
are applying for by obtaining a complete written proposal
is strongly advised that when purchasing life insurance you
consult professional advisors about plicoy details. Although
the policy may be financial protection for your life, the
owner of the policy doesn't need to be you. In many cases
it is beneficial for your spouse, a trust, an estate or a
business/corporation to own the policy. The general rule that
applies is that the owner and beneficiary need to have an
"insurable interest", in other words a financial
interest in your living.
what your grace period is and make certain that the insurance
company receives your premium on time. Coverage can be canceled
if premiums are not paid on time. It is possible reinstate
coverage if this occurs, but if you need it badly you will
most likely be denied.
for all options of paying your premium (monthly, Electronic
Funds Transfer, quarterly, semi, annual, and annual) in order
that you may evaluate your options carefully. Discounts are
generally given for EFT and annual modes of premium payment.
your policy carefully. Among typical exclusions are suicide,
death while in the commission of a felony and death that occurs
as a result of an act of war, but a few exceptions exist.