Term life insurance policies are often misunderstood by customers, in terms of their purpose and perceptions of how much it should cost.
Our linked article takes a look at the basics and reveals how useful and affordable term policies can be – so let’s examine it.
Term policies exist to provide support to loved ones in the event of untimely demise. They have fixed end-dates, usually ten, twenty or thirty years. Buyers often choose a date that matches the attainment of a finish line in their lives. This could include the 21st birthday of your last child, the date when you expect your mortgage to be paid, or the time when your retirement plan should generate sufficient income to care for a surviving spouse and junior children.
Our featured author notes that he bought a term policy when his first child was born – a common and reasonable move. If you want coverage to protect you for as long as you live, a permanent policy usually fits the bill, he counsels.
Industry insiders complain that many people don’t understand the different types of insurance, and indeed, many avoid a purchase altogether, no matter how much they may need a policy. One reason is cost: people routinely overestimate the price tag of coverage.
It doesn’t help that the interview process for buying insurance is so invasive – it needs to be, but it is uncomfortable for many. A new resource, TermLife2Go, seeks to help people understand insurance. When you apply for a policy, the provider investigates six areas to determine your premium: age, health, the type of product you want and its term, payout date, gender and lifestyle details. The more you know about these factors, the better prepared you’ll be to get the kind of insurance that suits your needs and budget.
For more information, please read:
Don’t dismiss life insurance as too pricey. Here’s how to pick a plan | USA Today