Term Insurance

What is Term Insurance?

Term insurance is a type of life insurance policy that provides coverage for a certain period of time or a specified "term" of years usually 5, 10, 20, 30 or 50 years in length.

Term insurance is the most affordable type of life insurance. You are able to get a large amount of coverage at low cost, the premiums are fixed and paid for the length of the term, You can extend or renew the insurance, but the new monthly premium will be based on the person's age and health at the time of the renewal.

 As a result, the premiums could be higher for the renewed policy versus the original term policy that was initiated when the individual was younger. If the insured dies during the time period specified in the policy and the policy is active, or in force, a death benefit will be paid. If the term expires and the individual dies afterward, there would be no coverage or payout.
When your term is up, coverage will renew automatically on a yearly basis, unless you cancel it, up to age 85 when coverage ends. Or, before your term is up, and in some cases later, you may be able to change it to different type of coverage. When you die, the insurance payout goes to the beneficiary tax-free. Your loved ones may use the money to pay bills, the mortgage, pay for kids’ education or keep your business running.

Why Term Insurance?

There are many reasons to consider Term insurance. It depends on your personal situation and your stage of life. Consider your age, income, debts and family structure. If you are looking for financial protection for a specified period of time with the option of making changes as your protection needs change, you have a mortgage or kids, you worry about providing for your family after you die or you have debt, you own significant property, assets, or investments, and you want to pass them down without the beneficiaries being subject to capital gains taxes, you own a business, and you want to ensure that it will have the capital to continue operations without you leading the way, you want to build insurability for a child in order to give them a range of financial options when they reach adulthood, life insurance through your job is not enough to cover your needs, etc.

What term is best for you?

Term 5 to 10
You’re not sure what life milestones lie ahead, so you need flexibility to extend your coverage or convert to a permanent policy for lifetime coverage, you’re looking for a low-cost insurance policy, you want to lock in your insurability while you’re still young and healthy. This means if your health changes, you’ll still be eligible for life insurance, your mortgage took longer to pay off than you planned, or your kids aren’t financially independent yet, so you need coverage to bridge the gap .

Term 11 to 20
You’ve chosen a shorter amortization period on your mortgage, or you’re already several years into your existing mortgage, you want to provide protection for your children until they’ve finished school or start working full time.

Term 21 to 50
You’re looking for coverage for a longer period that will cover you during life’s milestones, like getting married, having children or buying a house, you’ve bought a house and want the insurance coverage for the duration of your mortgage, instead of buying mortgage insurance, you have young children and want to make sure they’re taken care of until they’re financially stable, you want coverage that lasts until you retire, and you want premium payments that stay the same throughout your working life.

Term insurance is initially much less expensive when compared to permanent insurance. Unlike most types of permanent insurance, Term insurance has no cash value. In other words, the only value is the guaranteed death benefit from the policy.

You can choose a Term insurance that gives you flexibility to extend your coverage or to convert to a permanent insurance policy. You can modify your existing coverage as your life changes.
Are you ready to get started protecting the ones you love the most? Your advisor can discuss options that help meet your specific needs and determine what Term life insurance is best for you. Contact us for more information. We can assist you in obtaining a Term life insurance policy if you do not already have one.