Term life insurance is the most basic form of life insurance plans available. Most advisors recommend term life insurance plans due to the lower overall cost and fixed rates for the life of the policy, but even if you know that you want term life insurance, you must know which term life policy will best suit your needs and compare quotes accordingly. Term life policies include level term life insurance, decreasing term life insurance, and annual renewable term insurance.
Level Term Life Insurance
Level term policies stay in force for a specific number of years – five years, ten years, etc. – varying plans are available to suit your needs. Quite simply explained, the policy ends when the established period of time has expired or the policyholder dies. If the policyholder dies within the established period of time the beneficiary receives the full face value of the policy. If, however, the policyholder dies after the life of the policy, nothing is payable to the beneficiary.
You will find that most life insurance companies include a clause in the policy that allows you to convert a level term policy to a permanent policy within a specific period of time. For example, the purchase of a ten year level term policy will often offer conversion within nine years of purchasing the policy.
Decreasing Term Life Insurance
Decreasing time life insurance is among the most sought after term life insurance policies in the industry. The popularity of this type of policy is linked to the included feature of mortgage protection.
Decreasing term life insurance is ideal for individuals whose needs for life insurance are likely to decrease rather than increase, such as policy purchased late in life or for individuals seeking to exclusively protect the investment in their home. The policy is drawn out to last a specific number of years during which time the premium remains level and the death benefit decreases in a uniformed manner over the duration of the policy.
Annual Renewable Term Life Insurance
An annual renewable term life insurance policy is a one-year term life insurance policy with the option of renewal each year without the necessity of requalification year after year; however, premiums increase each year you extend the policy. Essentially, the increased rates correspond with the age of the policyholder.
Finding Top Rated Term Life Insurance Policies
Understanding life insurance is a challenge – knowing which plan will suite your needs best and just how much insurance you need takes some research and often, a helping hand. Dr. Alexander Sudarshan, an eye surgeon from Los Fresnos, Texas, has $4.8 million in life insurance — $1.6 million in whole life and the rest in term. And, in an interview with the New York Times, Dr. Sudarshan admits coming that to a decision was not easy – it took a lot of research and assistance from an expert. Get a free online life insurance quote today to ensure your family is protected.