Each of us has different needs for Life Insurance. Some would need large life insurance coverage while others have to work on a budget. We can always work with you to find an insurance that tailor fits your needs at an affordable price with Term Life Insurance. Costs of insurance should not hinder an individual from getting the insurability they deserve. Regardless of your budget, there is always insurance that you can get where you can give financial security to your loved ones in the event of death.
Term Life Insurance is bought by many people primarily because of its affordability. Its cost is very low compared to other types of insurance. However, the low insurance premiums that you are paying may sound like a great deal but may cost you more in the long run. Let’s discuss the benefits that you can get from the different types of Term Life Insurance
Types of Term Life Insurance Policies
There are several types of Term Insurance that provide different benefits to each policyholder at an affordable price. It may be noticed that Term Insurance is very popular because of its low cost, but it is also equally important to remember that once you miss paying your premium payments, your insurance policy is terminated. Reinstatement is possible, but not likely.
ART (Annual Renewable Term)
Annual Renewable Term is a type of Term Insurance that offers coverage within a specified period of years, renewable annually. During the specified period, the policyholder can renew his policy annually with retaking any medical examination. However, premiums increase as the policyholder ages while the death benefit stays the same. This type of Term Insurance is practical in the short term period. This will become very expensive if you plan to keep this in the long term.
Level Term Insurance is a type of Term Insurance where premium payments remain the same within the specified period of the policy. Most Level Terms are 10, 15, 20, or, if younger, a 30 Term possibility. Premium payments will be higher at the inception of the policy, but this will never increase during the whole term of the contract regardless of medical conditions within the term. The death benefit for this type of term insurance increases at the maturity of the policy. This attracts clients as premium payments stay the same while insurance coverage increases.
Convertible Term Insurance
Term Life Insurance provides coverage for a determined period as stated in the contract. However, financial capacity and insurance needs may change over time. Convertible Term Insurance gives the policyholder the option to convert Term Life Insurance to Permanent Life Insurance if his needs call for it. An advantage of this type of Term Insurance is that the policyholder gets to convert his policy without undergoing another medical examination. It would be as if his health condition is as good as when he started his insurance contract.
Return of Premium
Return of Premium is a rider that you can add to your Term Life Insurance. Having this rider in your insurance will increase your monthly premium payments. However, if you survived the term of your policy, you will be able to recover all the premium payments paid during the term of your policy. Remember that with Term Insurance, if you outlive your policy, you will not get anything from the insurance company. This is beneficial to those who would purchase insurance for a specific purpose. Like to be able to pay off the mortgage or pay their children’s tuition in case they pass away. Having a Return of Premium will assure them that they can have their money back if they outlive their policy. This also will serve as savings for them. It is a win-win for the policyholder because if he will pass away during the term, the surviving beneficiaries will get the death benefit. If he survives the policy, he will get all the premium payments made.
Waiver of Premium
Waiver of Premium provides the policyholder the benefit of waiving the premium payments of the insurance policy in the event when the policyholder becomes disabled, seriously injured or has acquired critical illness. Knowing that inability to pay a premium for a Term Life Insurance will terminate the contract, this benefit will help the policyholder have a safety net. Being disabled or severely injured, this could hamper the ability to work. As such, financial capacity can also be affected. Having a waiver of premium to your insurance may cost you more, but the benefit that you can get from it is worth it. During a financial crisis due to severe medical conditions, you don’t have to worry about how you can continue to pay for your insurance premium and still have the security of having life insurance.
It is important to consider the cost of obtaining Life Insurance. Costs include premium payments and other administrative fees. So if we do the math, sometimes you can save on administrative fees if you get one extensive insurance policy that suits your needs rather than buying several cheap insurances and pay a significant amount on administrative fees.
Choosing the best insurance policy does not mean getting the cheapest insurance in the market. You must consider first your needs and purpose for the insurance and find a policy that will cater to all your needs. It can get a little costly or can still be affordable. But the best insurance will always be the one where you can get the most benefits from. As mentioned earlier, convertible insurance may be beneficial to one client but not to another policyholder. Although these may add a cost to the policy, the benefits will always outweigh the cost.
No one insurance will fit the needs of all clients. Most insurance policies are tailored to fit each client.
It is important to talk to a Licensed Insurance Professional so they can find an insurance product that can be most beneficial and cost-efficient for you.
To find out more about Term Life Insurance and to get a free and confidential quote, call the professionals at BBIFinancial at (800) 958-1525.