Term Life Insurance Articles
When To Consider A Short Term Life Insurance Policy
2011-02-25
There are significant disadvantages to a short term life insurance policy, the biggest of which is the large costs associated with this purchasing strategy. While term life insurance quotes are lower for a short term life insurance policy, many buyers decide to buy coverage multiple times. They renew their term life insurance, and after each renewal, their premiums are higher than they were for the previous policy. Over time, this means that you'll pay much more for a shorter policy than you would for a longer term life policy. You might also be denied coverage as you get older unless you purchase a guaranteed renewable policy, and this can leave a person unprotected when he or she needs life insurance the most. Nevertheless, there are a few situations in which a short term life policy can be worthwhile and even a better choice than a longer policy.
One such situation is when you're between jobs or if you generally can't afford a longer policy. A short policy like an annual renewable term life insurance plan can be a good buy during these tough economic periods, as such a short policy will keep your coverage active and prevent a lapse. It'll be much easier to budget a short policy, so in any case in which budgets are a major concern, shorter term life insurance policies can be a better buy--at least until the buyer can afford a longer term plan.
Short term life insurance policies can also be valuable if you're trying to keep your family protected until a certain investment matures. For instance, say you have an IRA that you'll be able to access in ten years. Until the IRA is fully matured, it might not be enough to keep your family financially protected in the event of your death. However, you could buy a short 10 year term life insurance policy to keep them protected, allowing it to expire when the other investment is ready. Forming this type of a financial strategy is a good way to keep all of your bases covered, and it's an essential part of smart planning.
Overall, it's not a great idea to buy a short term life policy unless you have a valid reason to do so. Before you try to lower your policy's costs by shortening your term, try other methods of cost control. Go online and look for term life insurance quotes for longer plans. Remember, just because you received high term life insurance quotes from a few companies doesn't mean that there are no good, affordable policies available, and with some searching, any individual can stay protected.
Free Insurance Quotes
There are significant disadvantages to a short term life insurance policy, the biggest of which is the large costs associated with this purchasing strategy. While term life insurance quotes are lower for a short term life insurance policy, many buyers decide to buy coverage multiple times. They renew their term life insurance, and after each renewal, their premiums are higher than they were for the previous policy. Over time, this means that you'll pay much more for a shorter policy than you would for a longer term life policy. You might also be denied coverage as you get older unless you purchase a guaranteed renewable policy, and this can leave a person unprotected when he or she needs life insurance the most. Nevertheless, there are a few situations in which a short term life policy can be worthwhile and even a better choice than a longer policy.
One such situation is when you're between jobs or if you generally can't afford a longer policy. A short policy like an annual renewable term life insurance plan can be a good buy during these tough economic periods, as such a short policy will keep your coverage active and prevent a lapse. It'll be much easier to budget a short policy, so in any case in which budgets are a major concern, shorter term life insurance policies can be a better buy--at least until the buyer can afford a longer term plan.
Short term life insurance policies can also be valuable if you're trying to keep your family protected until a certain investment matures. For instance, say you have an IRA that you'll be able to access in ten years. Until the IRA is fully matured, it might not be enough to keep your family financially protected in the event of your death. However, you could buy a short 10 year term life insurance policy to keep them protected, allowing it to expire when the other investment is ready. Forming this type of a financial strategy is a good way to keep all of your bases covered, and it's an essential part of smart planning.
Overall, it's not a great idea to buy a short term life policy unless you have a valid reason to do so. Before you try to lower your policy's costs by shortening your term, try other methods of cost control. Go online and look for term life insurance quotes for longer plans. Remember, just because you received high term life insurance quotes from a few companies doesn't mean that there are no good, affordable policies available, and with some searching, any individual can stay protected.
