Term Life Insurance

What is Term Life Insurance?

Term life insurance provides coverage for a certain period of time. Your dependents will only be protected if you were to pass away within the covered term. The most common coverage term length is 20 years, but you can choose as low as to year or as high as 30+ year length. There is also a 1-year renewable term life option that is offered by many insurance carriers. Term Life Insurance is considered to be one of the most basic and affordable life insurance that can be purchased.

What Does it Cover?

Term life insurance is designed to protect beneficiaries against the financial burdens of the policyholder’s death. Term life insurance can cover a variety of items such as the cost of living of the beneficiaries and/or larger expenses such as loans or a college tuition. In some cases, you can also purchase just enough coverage to cover funeral costs and additional end of life expenses.

Just how much term life insurance do your need? If you would like to provide more than just end of life expenses, you will want to factor in your family’s anticipated future costs:

  • Estimate your family’s annual living expenses – food, rent, electric bills, water bills etc.
  • Estimate your family’s debts
  • Calculate the amount it would cost to pay off your mortgage
  • Estimate anticipated costs of major financial expenditures – weddings, college, etc.

When Is a Good Time to Buy Term Life Insurance?

Many people buy life insurance when they undergo a major life event such as getting married or starting a family. The most important time to buy life insurance is when someone else depends on your income. If you’re in a marriage or have family on the horizon it’s wise to start planning your life insurance policy. Your insurance needs should be based around responsibilities such as mortgage, a family, and bills, more that your age. It is also a good idea to re-evaluate your policy every few years as lifestyle, health situations, and responsibilities change.

How to Buy Life Insurance

Working with a trusted agency such as Grindell & Romero Insurance can help make buying term life insurance easy. Our agents will guide you through picking the right term length, policy, and coverage.

Some important determinations to consider before buying:

  • Future financial needs of your family
  • Term length that makes the most sense
  • Type of life insurance policies

Type of Term Life Insurance Policies

Although, term life insurance is relatively simple, you still will need to choose between renewable or convertible policies:

Renewable Term Life Insurance: This allows you to renew your policy every year up to a specific amount of years. You will be able to renew without any additional medical examination. This guarantees that you will still get life insurance even if your health were to suddenly decline.

Convertible Term Life Insurance: This allows you to convert to a permanent whole life insurance policy at a later date without medical underwriting.

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