What Is Term Life Insurance 

What Is Term Life Insurance

You have probably heard of it before, but many people are probably still wondering what is term life insurance and how is it different than other life insurance policies? This is a very important question to ask before you go looking for the right life insurance policy for you. Term life insurance is a type of policy that covers you for a very specific period of time, and should you die during that specified time period, the insurance company will pay out what is known as a death benefit to your loved ones. You also decide the amount when you choose the period of time, and the higher the pay out amount, the higher your premium will generally be. Term coverage usually is offered for 10, 15, 20 or 30 years. That is essentially it, but there are many different types of term life insurance policies and some might be better than others, depending on your situation.

Reasons to Buy Term Life Insurance

Most people choose to get a term life insurance policy to cover a specific period of time that they want to ensure that their families will have financial security. For example, maybe you are a new parent and want to make sure that in the terrible event of your death, your new child will have some financial help. In this case, perhaps you would choose a 20 year term policy, so that it covers you until your child is an adult. Or maybe you want to cover a period of time until you are retired. Or perhaps you are concerned about a doctor's visit and would like to get no exam life insurance. Any of these types of situations would make term life a good option.

Term Life is Less Expensive

Term life policies have several distinct advantages, the most and usually the most attractive is that this is usually the cheapest form of life insurance policy you can take out on your self. Especially if you are younger and in good health, term life insurance policies can be very inexpensive. Once the policy's time limit is up and you want to renew or extend the term coverage, you can expect it to cost much more than the first time. Here are some factors that will affect your premium prices:

  • Your age
  • Your health
  • The length of coverage
  • The coverage amount

Comparing Term to Whole Life Insurance

Term life insurance covers you for a specific time, but what if you want to be covered your entire life? Then whole life insurance may be the better option for you. It is much more expensive than a term policy, but a whole life policy builds a cash value that you can borrow against or withdraw from. Term policies do not offer these benefits, and once the term is up, the policy is not worth anything. However, term life policies are much cheaper than whole. Your specific situation and needs should determined what type of policy you get. Here is a quick comparison of the two types:

Concern Term Life Whole Life
Cost Less Expensive More expensive
Duration Specific time period Covered for life
Other benefits Can cancel or upgrade at any time Builds cash value

Finding the Best Life Insurance Policy

With so much to understand and take into consideration when buying life insurance, it can easily get overwhelming. It is critically important to find a life insurance broker or agent that can keep all these factors and your best interests in mind and shop the competition. We can find you the best agents that can help you find the best policy for your situation and get you the coverage and peace of mind that you deserve.

Disclaimer: TermLifeInsuranceUSA.com is not a licensed insurance agency or broker. The content of this website is for informational and comparative purposes only and is not intended to take the place of professional advice from a licensed insurance agent. TermLifeInsuranceUSA.com recommends that all consumers consult with a licensed insurance agent before purchasing any insurance policy.

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