Term Life Insurance

If you have ever talked to a financial advisor, one of the first questions they must have asked you is whether you have life insurance. Why? This is because it is the core of any sound financial plan that goes even beyond your life.  

Term life insurance is a form of life coverage where protection is provided at a fixed rate for a specified period of time. This is a benefit policy that covers you over the period and helps cater for financial responsibilities with benefits paid to your dependants, only if you die before maturity of the policy. For this reason, this coverage is also referred to as temporary coverage.

Benefits of Term Life Coverage

According to the Insurance Information Institute (III), this is an ideal cost-effective investment option in case you are facing growing financial responsibility on a tight budget. It is also advantageous because you get maximum protection, yet you pay the lowest premiums, which explains its popularity.

Its benefits are also not being taxed and you get a flexible policy period that fits your income. Moreover, you can convert it to whole life or permanent life insurance as per your needs.
There are two major types of term life insurance covers namely:

  1. Annual renewable term life coverage: Purchased for one with the benefits only to be paid if you die within this period, and is renewable after the term period.

  2. Level term life coverage: You are guaranteed a fixed premium for a period of time based on your age, health and other factors.

Still lost on term life insurance? Just call an insurance agent and make sure you have your back covered in case of anything.