Term insurance provides coverage for a specific period of years. This period of years is known as a “term,” and when the term ends coverage must be renewed.
Most term policies do not build any cash reserves, but they provide the greatest amount of death protection for your dollar. Term insurance is strictly for protection. In order for it to pay benefits, the policy must be in effect when you die.
Term premiums are based on your age. The cost goes up as your age goes up. For example, if you’re 50 or 60, term insurance will be much more expensive.
If you develop medical problems before the term ends, you may have difficulty renewing your policy, unless it is guaranteed renewable. This means that you can continue your insurance at the end of each term without a medical examination. All you have to do is pay an increased premium.
In most cases, guaranteed renewable term policies can be continued until a certain age, such as 70, 80, or even 100, when all coverage stops.
Insurance companies also offer convertible term insurance, which lets you change your policy from term to whole life.
Most term policies do not build any cash reserves, but they provide the greatest amount of death protection for your dollar. Term insurance is strictly for protection. In order for it to pay benefits, the policy must be in effect when you die.
Term premiums are based on your age. The cost goes up as your age goes up. For example, if you’re 50 or 60, term insurance will be much more expensive.
If you develop medical problems before the term ends, you may have difficulty renewing your policy, unless it is guaranteed renewable. This means that you can continue your insurance at the end of each term without a medical examination. All you have to do is pay an increased premium.
In most cases, guaranteed renewable term policies can be continued until a certain age, such as 70, 80, or even 100, when all coverage stops.
Insurance companies also offer convertible term insurance, which lets you change your policy from term to whole life.
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