Term insurance policy coverage is a famous type which many people run to whenever they want to save their families from financial troubles after they have passed. The most common term for many people is the 20 years term, but one can even go for up to 30 years. There are other possibilities for people who want to negotiate with the company for other terms which are possible. This policy type has great advantages and is the reason why many people go for it. For those who opt for the long-term policy, this is better for those who want to protect and leave some inheritance for their families.
Benefits of applying for term insurance policy
One of the biggest benefits that one reaps from using this type of insurance policy is the lower initial cost that is involved. The permanent policy is a bit expensive when compared to the term life. The reason for this is because, with the latter, one is only applying for a death benefit. This means the amount of money that beneficiaries will be given as the lump sum should you die within the specified time. However, this will have to be within the period of the term policy. If a person dies and it expired the day before, then the beneficiaries will get nothing.
Why is term insurance a good choice?
Many people have wondered why term life insurance is a good choice for them. Some people do not have the facts with them which make them opt not to purchase the term life policy. This policy is good for people who are in the family-formation years. If they are on a tight budget, this is the policy that will help them pick up. It allows them to provide coverage for high levels and at a time when protection is needed urgently. It is also good for people who want to cover for the need that will disappear after some period. This makes it easy for people who purchase them, unlike the permanent life insurance.
When the term comes to an end
If one is still interested in the life insurance cover yet their term has ended, they have the option to renew it. The only bad news is that at renewal, the premiums will go up because you have aged with time which is a major factor to consider. If your health has deteriorated with time, this could prove to be expensive since the company may not be willing to take the risk with your health.
Premium return option
This is a feature that allows one to get a refund of all the premium they paid during the period of the term. If it was 30 years, then it will account for all of them.