Term insurance is a type of life insurance that provides coverage for a specific period of time. It is often referred to as temporary life insurance because it provides protection for a limited amount of time – usually 10, 20, or 30 years. Unlike permanent life insurance policies, which offer lifetime coverage, term policies have no cash value and are designed to provide protection only in the event of death.
How does term insurance work?
When you purchase a term life insurance policy, you pay premiums for a set period of time – typically one, five, ten, or twenty years. If you die during that time frame, your beneficiaries will receive a death benefit payout. If you don’t die during the term of the policy, the policy expires and you don’t get anything back.
Who Buys Term Insurance?
Term life insurance is a popular choice for people who want to provide financial protection for their loved ones, but don’t want to pay for a permanent life insurance policy they may never use. It’s also a good choice for people who only need coverage for a specific period of time, such as when their children are young or they have a large mortgage.
Comparing Term Insurance
If you’re considering purchasing term life insurance, it’s important to compare policies from different insurers to make sure you’re getting the coverage you need at a price you can afford. You can use an online life insurance calculator to get an estimate of how much coverage you need and compare quotes from different life insurance companies.
Questions To Ask
When shopping for term life insurance, be sure to ask about riders that can add additional protection, such as a living benefit rider that pays out a portion of the death benefit if you are diagnosed with a terminal illness. You may also want to consider a conversion rider that allows you to convert your term policy into a permanent policy without having to undergo a medical exam.
Conclusion
No matter what type of life insurance you’re considering, be sure to work with an experienced life insurance agent who can help you select the right policy for your needs. And remember, life insurance is not a one-size-fits-all product – the best life insurance policy for you is the one that meets your specific needs and budget. Request a quote below.
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Frequently Asked Questions?
Which is better term insurance or whole life?
Term life insurance provides coverage for a set period of time. It can be less expensive than whole life insurance. Whole life insurance provides lifetime coverage and has the potential to build cash value savings. You should speak with a life insurance agent or broker to determine which type of policy is best for you.
Which of the following best describes annually renewable term insurance?
Annually renewable term insurance is a type of life insurance that renews automatically each year, typically at a higher premium. The policy does not build up cash value like whole life insurance, but it does provide coverage for a set period of time, usually 10-30 years. This makes it a good option for people who need temporary life insurance coverage.