Term Life Insurance Articles
Three Benefits Offered By A Long Term Life Insurance Plan
2010-12-11
A term life policy can offer its policyholder certain important long term benefits. Basically, a term life policy is one that provides coverage for a specific period of time (the term) for a fixed payment amount (the premium). The policyholder may be aware that they are insured against death during the policy period. Typical term policy periods may be 5, 10, 15, 20, 25 or 30 years. However, the customer may be unaware of some of the long term benefits which their policy may afford.
Affordability
A term life policy is going to be the cheapest of the three types of life insurance. Term life insurance was originally developed to appeal to those customers with a limited budget and financial resources. One of the reasons that they are so inexpensive is because there is a very low likelihood of a policyholder filing a claim against the policy within the policy period. This is because term policies are sold to relatively healthy individuals. Therefore, insurance companies are able to offer these policies for very low premiums. Term life insurance policies are generally best for short-range goals such as paying off a policyholder's death in the event of his death. They are not intended to be an investment vehicle.
Renewability and Conversion
Many term life policies offer up the double benefit of being both renewable and convertible. A renewable policy is one that allows the policyholder to continue coverage after the original policy period has elapsed. Typically, there would be an increase in premiums at the time of renewal, and the renewal would be offered for another specific fixed period. A convertible policy is one that permits the policyholder to change their term life policy into a permanent life policy at any time within the policy period.
Lump Sum Payments and Waiver of Premium
Additional long term benefits that some term life policies offer include the option of having a lump sum payment made under the policy. This would happen due to either critical illness or terminal illness being diagnosed prior to the policyholder's death. In the event of some diagnosed illnesses which prevent the policyholder from working, the policy may allow for a waiver of premiums. A deferment period may apply.
Life insurance is a critical component of estate planning. Be sure to comparison shop for the best term policy and compare the features being offered by each policy in order to determine the one with the best long term benefits. Term life insurance policies can afford fantastic benefits in terms of affordability, renewability, conversion and options such as lump sum payments and waiver of premiums in the event of critical and terminal illness.
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A term life policy can offer its policyholder certain important long term benefits. Basically, a term life policy is one that provides coverage for a specific period of time (the term) for a fixed payment amount (the premium). The policyholder may be aware that they are insured against death during the policy period. Typical term policy periods may be 5, 10, 15, 20, 25 or 30 years. However, the customer may be unaware of some of the long term benefits which their policy may afford.
Affordability
A term life policy is going to be the cheapest of the three types of life insurance. Term life insurance was originally developed to appeal to those customers with a limited budget and financial resources. One of the reasons that they are so inexpensive is because there is a very low likelihood of a policyholder filing a claim against the policy within the policy period. This is because term policies are sold to relatively healthy individuals. Therefore, insurance companies are able to offer these policies for very low premiums. Term life insurance policies are generally best for short-range goals such as paying off a policyholder's death in the event of his death. They are not intended to be an investment vehicle.
Renewability and Conversion
Many term life policies offer up the double benefit of being both renewable and convertible. A renewable policy is one that allows the policyholder to continue coverage after the original policy period has elapsed. Typically, there would be an increase in premiums at the time of renewal, and the renewal would be offered for another specific fixed period. A convertible policy is one that permits the policyholder to change their term life policy into a permanent life policy at any time within the policy period.
Lump Sum Payments and Waiver of Premium
Additional long term benefits that some term life policies offer include the option of having a lump sum payment made under the policy. This would happen due to either critical illness or terminal illness being diagnosed prior to the policyholder's death. In the event of some diagnosed illnesses which prevent the policyholder from working, the policy may allow for a waiver of premiums. A deferment period may apply.
Life insurance is a critical component of estate planning. Be sure to comparison shop for the best term policy and compare the features being offered by each policy in order to determine the one with the best long term benefits. Term life insurance policies can afford fantastic benefits in terms of affordability, renewability, conversion and options such as lump sum payments and waiver of premiums in the event of critical and terminal illness.
