About Term Life Insurance
Term life insurance offers death benefit protection
When you buy term insurance, you buy death benefit protection for a limited period, for example, 1, 10, or 20 years. Term life insurance is often considered "pure protection", and sometimes called "what if I die insurance". The face value is payable if death occurs within that time; there is no cash value buildup within your policy. Premiums are often significantly lower than for permanent insurance, but may increase as you get older. However, level term policies are available where the premiums are guaranteed never to increase, despite the fact that you keep getting older (note: you need to continually make your premium payments in order to avoid lapse or cancellation). Most term policies allow you to renew every year without undergoing any additional insurability tests. Under some policies, the premium changes every year; under others it stays level for a certain period, then begins to increase. Some term policies allow you to convert your term policy to a permanent policy (at your then-current age) without proof of insurability. Term insurance is ideal for covering a specific limited-term need, for example, an outstanding mortgage or business loan. Some companies offer term insurance that decreases as the mortgage principal declines over time.
