Term Life Insurance
What is Term Insurance?
Term insurance is the most basic and affordable form of Life Insurance. Term Insurance is implemented to provide a pure death benefit protection for a specific period of time that can usually range from anywhere between one year to thirty years. Term life insurance will only insure the death benefit of the policy only if the client passes away during the term period. If the client is still alive when the Term policy expires, the client may renew his policy, which usually will come at a higher premium the year after.
Benefit of Term Life Insurance
A lot of Term Life insurance policies allow for the policy to be converted to a permanent insurance plan without undergoing additional medical underwriting, however, depending on your policy and carrier, the time period and products available will vary.
Why Term Insurance may be right for you:
Term insurance lacks premium and death benefit flexibility and generally will not accumulate a cash value at the end of its term.
Term insurance may be right for you if:
You have temporary protection needs.
o E.g. until your children graduate from college, to pay off mortgages, car loans etc.
You need a large amount of insurance at the lowest cost possible
o Receive the best coverage plan without spending a fortune
Other Types of Term Life Coverage
Another type of term insurance is an ROP also known as a Return of Premium. An ROP Term policy will provide a return on the premium that was originally paid when the term period comes to an end if the client is still alive and the policy hasn’t expired. ROPs are very popular in business cases because when ROP premiums are returned at the end of the term period, the business would recover all costs on the premium, which is the ultimate goal.
