Term Life Insurance

You purchase a life insurance policy for a set death benefit (ex: $500,000), for a set period of time or term (ex: 30 years) for a set premium. You pay the exact same annual (can be monthly) premium every year until the term is up. When the term is up, the policy expires. The premium never changes and neither does the death benefit. You do build up cash value like you would in a Whole Life or Universal Life policy.

At a bare minimum, almost everyone should have a Term Life policy at some point in time…especially those that are younger. The policies are inexpensive and you can get them for up to 40 years.

The older you get, the more expensive the premiums become.  But, even at 60 years old, for someone in good health, if life insurance is still needed, then premiums are still reasonable considering the death benefit your heirs will receive. 

One of the ideas with Term Life insurance is to save on premium dollars as compared to Whole Life and invest the difference and then by the time you retire you have ample investment savings and don’t need the benefits of a life insurance policy. Unfortunately, many people don’t invest the difference and/or still have a life insurance need later in life. Plus, there are other advantages and reasons to purchase and own life insurance other than a death benefit. 

Benefits Of A Term Life Policy

1. Simple to understand
2. Secure a large death benefit for your heirs
3. Low premium compared to a Whole or Universal Life policy

The Downsides Of A Term Life Policy

1. No cash value — But that’s not why you bought it, so it’s not really a negative.
2. It may end before you die and consequently leave your heirs without the death benefit.

*Note: Some Term Life policies can be converted into permanent insurance later. There is typically a deadline during the life of the policy that you can do this. 

For a FREE Term Life quote, please contact me.