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Term Life Insurance Understood

By: Roger Kelley Many experts agree that an important part of a well-rounded financial plan is term life insurance. Life insurance provides death benefits to your beneficiaries and that can be invaluable. The insurance money can replace some of the income you were earning. This can help provide a stable financial future for your spouse and preserve any investments, savings, or other assets you intended on paying off.

The Benefits Of Term Life Insurance:

Term life insurance is a policy that provides coverage to the insured over a certain length of time. One key characteristic of level term life insurance is that the premiums remain level for the life of the policy (whether it be 5, 10, 15, 20, 25, or 30 years).

However, you may opt for "yearly" renewable term life insurance which has a lower initial premium. With this option the premium rises each year. Be advised that yearly renewable term life insurance is only cost effective for a few years because of the increasing premiums. Before you invest in term life insurance you need to decide if you are looking for a solution that runs more than a few years. A level term life insurance policy can cost less depending upon the number of years you'll require coverage.

Reasons For Buying Term Life Insurance:

Term life insurance cost less than permanent insurance. A potential buyer may have young children at home and he/she has to protect his/her income. They may have bought a house and now have a 30 year mortgage for $500,000. Hence, they would need to purchase a level term life insurance policy for $500,000 30 year term to cover their mortgage. If something were to happen to the proposed insured between now and the next 30 years the insurance company would write a check for the full face amount of the term life insurance- policy for the survivor to pay off the mortgage and the balance would be paid to the designated beneficiary.

Conversion Option:

One nice thing about term life insurance is you can consider conversion options, such as a convertible option. A convertible term life insurance policy means that during a specified time you can convert all or part of the term insurance to a permanent life insurance product. If you chose3 this option you wouldn't have to prove evidence of insurability since you were already insured. For instance, if you take out a term life insurance policy your need for the amount of coverage may change down the road. You may still need some life insurance but can afford to lower the face amount of the policy, thereby lowering your premiums when you excercise a coversion option. The conversion option on a term life insurance policy simply gives you the option to convert over a certain amount to cover final expenses.

Term life insurance is very attractive to young families simply because it can be bought at an extremely low price. While you're young and enjoying a high expectation of good health you can lock in a term rate ... being young and healthy has its benefits and the cost of term life insurance is guaranteed for the full length of time on a guaranteed level term.

However, some clients like to combine different types of insurance plicy for even greater benefits. You can use term life insurance with a permanent life insurance policy so that during the earlier years of the policy you will have more coverage. As you get older you may not need as much insurance as you originally applied for. For example, the children are grown and/or the house is paid off so the need for so much coverage is not there. At that point you could allow the term insurance policy to expire and still have the permanent insurance that was put in force at the same time the term insurance was issued. If you take advantage of this opportunity you will still have the permanent life insurance to pay off final expense benefits down the road.

Why You Need Life Insurance:

1. Protect your family’s home by allowing them to pay off your mortgage.

2. Maintain your family’s standard of living.

3. Give you spouse a retirement income.

4. Pay off outstanding debts you have incurred.

5. Save the family business.

Important Benefits Of Term Life Insurance Policies:

1. Term policies are designed to meet a multitude of personal and business needs and offer the most coverage for your investment.

2. Term insurance provides protection for a certain period of time (10,15,20,25,30 years) and pays the death benefit to your beneficiary if anything were to happen to you during this time.

3. Unike other types of insurance term life insurance policies do not accumulate cash value. However, several companies will allow you to convert your policy to a permanent policy if the need arises.

Article Source: http://www.lifeweightloss.com

Term Life Insurance article submitted by Roger Kelley. Protection for you and your family. Only a few minutes away and three easy steps at Term Life Insurance
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