The Basics of Term Life Insurance

Term life insurance is usually considered a short term solution (5-30 years) for one or more short term or fixed term needs like a mortgage, car loans, or college funding for your children.

Term insurance makes a lot of sense when you are young with a growing family, because the rates are low and the benefits are high.

  • Term insurance is purchased for a specific number of years.
  • Premiums are lower than whole life insurance, especially in the early years of the policy.
  • Premiums increase with age or at renewal of your policy depending on the type of term life insurance policy you choose.
  • Term insurance builds no cash value.
  • Based on a study at Penn State University in 1993, less than 1% of term life policies ever pay a death benefit.   People usually outlive or discontinue their policy.
  • Most term life insurance policies cannot be renewed past the age of 80.

Why Do I Need Term Life Insurance?

Term life insurance offers you a way to provide cash for your family in the event you die. The money your beneficiaries receive from your life insurance policy can be used to pay for your burial costs and final expenses. It can also be used to pay off credit card debt, a mortgage or rent and other living expenses for your family. Life insurance benefits can also be used to pay for college tuition, provide money for retirement, provide cash to pay your estate taxes, or provide a stream of income that can help your family maintain their lifestyle. Also, the death benefit paid from a life insurance policy is usually income tax-free.

If you are thinking about getting some term life insurance coverage for your family, be sure to speak with an experienced agent about your situation. Get a free quote today to compare multiple rates from the nation’s top carriers.

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One Response to “The Basics of Term Life Insurance”

  1. gerald glawe says:

    i need 200,000 term life ins for 10 years my age 70 non drinler smoker….take no medicine…….health 0 to 10 me a 9.7

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