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Should You Settle For A Term Life Insurance Policy?

Price is always a consideration, even when insurance policies are concerned. This is why a phrase life insurance policy is now very popular in recent years. A term insurance policy offered the same features and benefits of a traditional life insurance policy, even though restricted to a certain phrase, hence the label term life insurance policy.

A lot of people are settling for an expression life insurance policy today, but should the expression settling be the right phrase? A term life insurance policy is replete with so a lot to offer for your stated beneficiaries after your death. Is it proper to say that a term insurance policy is a simple second choice after that? Lets take a deeper look at the intricacies of a term life insurance insurance policy.

The Benefits Of A Term Life Insurance Policy

An expression life insurance policy is a very advantageous choice. A term insurance policy is presented with so many benefits which is worthy of serious consideration. Lets study these benefits of a term life insurance policy:

The premium of the term life insurance policy is more affordable, hence, it has become a lucrative option for people wanting to acquire the benefits of a life insurance coverage but cannot afford the most common monthly payments.
* A phrase life insurance policy offers the same benefits for the beneficiaries of the insured, and in some cases, a term life insurance policy even offers much more benefits for them.
* A term life insurance coverage goes well along with any financial plan. Parents, for example, can acquire a term life insurance coverage that would guarantee their particular childrens education in the event that tips over to the insured mother and father during the term from the said term life insurance policy.
* A term life insurance policy can be paid out, or sold, by a person above 65 years of age or simply by an insured who is suffering from a terminal disease.

The Disadvantages Of A Term Life Insurance Plan

This is not to say a term life insurance policy just isn’t without disadvantages. Let all of us take a look at the constraints imposed on a term life insurance policy:

* A term life insurance policy would certainly only insure the individual for a certain period of time. Once such period lapses, the term life insurance policy must be surrendered.
* The grant of a term life insurance insurance policy may take a longer period to approve. Much examine would be made by the business offering the term life insurance policy before any software may be granted.
A term life insurance policy demands utmost integrity and good trust. You cannot lie inside your application for a term insurance policy, especially with information about your medical history. Material concealment within the application for your term life insurance policy would result in the cancellation of the same.
* The rejection rate is higher in applications for a term life insurance policy.

The propriety of availing of a term life insurance coverage would depend on your needs. I youd be able to work with the restrictive terms of an expression life insurance policy, youll definitely reap a lot of rewards from the same.

Comments: 48

  1. Annice March 26, 2013 at 12:13 am Reply

    I see the advertisings on this type of policies. My husband and I are planning on taking out a life insurance policy each, making each other the beneficiaries…

    What’s the difference?

  2. Zachery March 26, 2013 at 9:57 am Reply

    I want a new joint life insurance policy as we’re moving home, but instead of the usual life and critical illness (the latter part of which I’m told rarely pays out anyway), I’d like a life insurance policy that will pay me on maturity, i.e. at the end of the term. My inlaws are forever getting sums of money for insurance policies they took out years ago, but I can’t find out where to get one. I need at least £100,000 of life insurance for at least 20 years as it has to cover my mortgage if one of us dies. Am I looking for an endowment policy? How do I get one without finding a financial advisor?

  3. Chang April 11, 2013 at 5:10 am Reply

    My friend has a term life insurance policy that is less than 2 years old. She entered the hospital recently for a newly diagnosed bipolar disorder and had admitted to thoughts of suicide. Within 2 months of her stay and diagnosis, her term life insurance policy was canceled by the insurance company for reasons of risk. Can they legally do this? I read the policy, but am unclear whether they have the right to do this. Thanks.

  4. Bernard April 28, 2013 at 1:06 pm Reply

    I’m looking to buy a term life insurance policy and am amazed at the big price difference across difference providers. This is a really basic product that seems like it should be a commodity – if you die, your beneficiary gets paid. Is there any rationale for not going with the cheapest provider (so long as reputable, decent credit rating, etc)?

  5. Chas May 15, 2013 at 11:11 pm Reply

    Sam is applying for a single year life insurance policy worth $69,900.00. If the actuarial tables determine that she will survive the next year with probability 0.99, what is her expected value for the life insurance policy if the premium is $423.00?

  6. Toby June 2, 2013 at 11:50 am Reply

    We recently found out we are expecting a baby and need to open a life insurance policy in case something would happen to him so we’d be taken care of. We have insurance that is paid for by his employer. How do we go about getting life insurance? Is it added to our existing medical insurance, or can we get it separately?

  7. Sidney June 2, 2013 at 11:50 am Reply

    I am planning to buy an life insurance policy of around 25-30 lakhs. I have heard about this new insurance product- term insurance. I wanted to know its benefits and how is it different from life insurance. thank you for your help. I would really appreciate your efforts if you can help me out with this as soon as possible. thanks!

  8. Lavern June 5, 2013 at 4:41 am Reply

    I am in my late 20’s and have 2 daughters. Thru my employer I have about $1 million group term life insurance policy plus death benefit thru vested pension plan. Should I go ahead and purchase additional term life insurance from the 3rd party or would it be the waste? I cannot afford permanent life insurance policy due to extremely high premiums.
    It seems to me that I should not seek additional policy since I will always be employed and when I am unemployed I could always initiate a term policy then? What are the arguments?

  9. Roberto July 29, 2013 at 12:18 pm Reply

    I’m talking about the Army, in particular. Is it term life insurance, or permanent life insurance?
    As of right now, my husband’s job doesn’t put him on the front lines. I already know how much life insurance the policy is for. I’m just trying to figure if I should get life insurance and for how much. Does anyone here know the difference between term and permanent life insurance? That’s all I need to know. Is his life insure term or permanent.

  10. Yoshie August 17, 2013 at 4:21 am Reply

    So I am already on medicaid. I talked to a lady from medicaid who said I am not aloud to have a life insurance policy. Then I talked to an agent who said I can have a term policy up to any amount (which of course wouldn’t work for me) or a whole life policy up to $1500, or if the policy is over $1500 face I can have up to $2000 in cash value. Then I talked to another agent who said that the cash value counts towards your assets and that the $2000 is a combination between your assets and cash value (in other words, your cash value is included in your assets). Now I am thoroughly confused. I understand cash value and face value, but which is it? How exactly does the cash value count towards medicaid?
    mbrcatz: I’m just looking for a $3000 policy to aid in burial. It will cost me under $30 monthly.

    And I’m still unsure of the main question: Is the $2000 asset limit including cash value of life insurance, or does the life insurance have it’s own separate limit that doesn’t co-mingle with the asset limit?

  11. Emerita August 19, 2013 at 5:38 pm Reply

    I currently have a $300,000 Adjustable Life Insurance policy and want to convert it to a $300,000 20 Year Term. Can I do this or will I have to surrender the policy and start a new policy? I checked my life policy and there is nothing mentioned about any type of conversion. Just curious about everyone’s thoughts.

  12. Sharolyn December 23, 2013 at 5:26 am Reply

    I am married. Both my wife and I have rev trusts. For a new term insurance policy I think I want my name to be the proposed insured, my wife as beneficiary followed by my trust as the second or contingent beneficiary. What can yo tell me?

  13. Emanuel December 25, 2013 at 1:49 pm Reply

    I would like to buy a $100,000 term life insurance policy. I am 55 years old. Anyone know about how much this would cost me and the best company to buy from?

  14. Izetta December 27, 2013 at 7:41 pm Reply

    I recently enrolled in a long term life insurance policy to cover my children in case of my accidental death, however I just realized I already have 3 other life insurance polices on myself and 2 on the kids and I am trying to dis enroll. Will it cost me anything to dis enroll? The rep that enrolled me said I was enrolled FOR LIFE is that true?

  15. Socorro December 31, 2013 at 7:08 pm Reply

    I have to schedule a physical exam for a term life insurance policy I recently applied for, but have been fairly sick with the flu for the past week. I obviously want to be in good health for the exam, so I imagine it would be a good idea to postpone? How long would you recommend?

  16. Mari January 11, 2014 at 5:25 am Reply

    My husband and I both have odd life insurance policies. They are considered term policies because they do expire, but as long as we don’t die, we get all our premiums back at the end. It was a new type of product they were offering. Since we are young (25) we thought it was a good idea because basically when we turn 45 we get all that money back to do with as we please.
    Anyways, what if AIG can’t pay us back in 20 years…?

  17. Herman February 20, 2014 at 10:31 pm Reply

    can i extend an existing term life insurance policy if i am now terminally ill ?

  18. Britt February 21, 2014 at 8:18 am Reply

    i want to know more about term insurance

  19. Collen February 21, 2014 at 8:18 am Reply

    I’m starting to look into life insurance, but am wondering which one is the best option. I see that term is cheaper and I can locked into 10, 15, 20 or 30 years. But then I am seeing whole life insurance, and its more expensive, and I see that if i need money one day, i can withdrawal some of it, from that insurance. But I’m just wondering……… Thanks…..

  20. Devora February 21, 2014 at 11:05 am Reply

    What is primary difference between “whole” and “term” life insurance? I heard one was a scam/rip off; but no one knows which one.

  21. Junita February 21, 2014 at 11:05 am Reply

    My wife and I just bought a Universal life insurance policy. We each have $100,000 in coverage. After talking to my parents, who are 59 and 58 years old and have term life, we think we are paying too much per month for premiums. Our agent showed us and told how the premiums we pay will partially go into a savings account and collect interest. This looked like a good thing and that is why we went with the Universal coverage. He also told us that the premiums for term would keep going up as we got older. My parents pay a combined $65/month for there life insurance (with $150,000 coverage each). My wife and I pay a combined $125/month. After talking to my parents and reading up on the difference between universal and term, it seems that the money that is suppose to be in a “savings account” with universal, might not be all it’s cracked up to be. I know they gaurantee you a certain interest rate, but that is only if they perform and make the profits that they need to. My question is will there really be as much money in a “savings account” as the agent showed us, or will we cash out at the end and only get a few hundred dollars? Can you explain the difference a little better for me? Thank you very much for your time

  22. Horace February 21, 2014 at 8:08 pm Reply

    My father in law has a term life insurance policy with a face value of $500, issued in 1957. In 1967 all of the premiums were paid, and he has an endorsement certificate stating it has been paid. If he were to cash it in today, how much would his policy be worth?

  23. Omer February 21, 2014 at 11:28 pm Reply

    My mom who trust people too easily, bought the $100,000 10 year term life insurance about 7 years ago. She just told me recently. The agent told her that after the 10 year is up, she can either “keep paying or keep it there until she die and the money ($100,000) will be pay out to the beneficiary”.

    HMMMM…..?!!! REALLY?

    I don’t know much about life insurance but I thought that sound really fishy. So I tried calling the insurance company but they’re closed at this time. I searched the web and most insurance policy stated that if you buy term life insurance and you DO NOT DIE within the term year you and your beneficiary won’t get anything unless you renew it.

    If you know anything about life insurance please let me know. I am worried that she got tricked.
    Thank you

  24. Gregg February 22, 2014 at 2:13 am Reply

    Hi There,

    I’m about to get married and have a large amount of mortgage debt (4X my income). That said, half of that is already being more than paid for by renters. I’m just wondering two things: 1) What’s the diff between whole and term life insurance? 2) Do I need life insurance, b/c my partner makes 1/5th of what i make, and if i die, I don’t want her saddled with all my debt.

    If I do get life insurance, wouldn’t I want to get a type of insurance that pays me back in dividends and gives me equity, instead of every year paying money to insure my life, and to just “flush it down the drain” if i don’t die?

    thanks!

  25. Warner February 22, 2014 at 2:13 am Reply

    Let’s say company A takes a policy of on a CEO. They pay 40,000 in premiums and CEO collects 10,000 in premiums. Upon CEO’s death company A collects 1,500,000 and CEO’s wife receives 100,000 from life insurance proceeds. What are the tax effects to company A and CEO’s wife?

  26. Columbus February 22, 2014 at 2:57 am Reply

    Hi
    What is the recommendation, term or universal?
    I have universal now, in my 40’s, paying the lowest premium possible and I am a standard type for health.
    Thanks
    Tony

  27. Cruz February 22, 2014 at 7:06 am Reply

    If I am an 80 yr term life insruance policy does that mean if I die before the age 80 I do not get anything/

  28. Deedee March 11, 2014 at 9:22 pm Reply

    We paid the AIG term life insurance for more than 3 years, and lately my wife just found out she has a tumor, and we also found out her insurance is lapsed. What can I do now, and will the insurnace company reject her policy even we try to reinstate it. The grace period is gone also. Thanks.

  29. Rebekah March 11, 2014 at 9:23 pm Reply

    Hi I was wondering if you would be able to look at a brief summary of my family situation and give me some suggestions.I want to get insurance but can u recomment some changes in what I presently have. I thank you.
    I am married and have 3 childern (ages 9, 12, and 16) I just bought a waterfront home which is valued at 500,000 with a 300,000 mortgage. My jewrely is about 10,000. We have 3 cars a 2004 BMW, a 2002 Lexus and 1997 Jeep Wrangler. My husband works at a large manufacturing firm and earns about 125 K. I run a day care center from my home and earn about 45K. I don’t have any employees.
    My kids all go to private school – which costs me about 25 a year. We honestly have no savings or investments and almost no discretionary income at the end of the month. ( which is a main reason I am writing this!)
    I met with a financial planner and they suggested on purchasing a 50,000 variable life policy for each of us as an investement. I think i am worried about the high vost of these policies
    This is what is presently covered
    property risks
    Ho3 with no endorsements or riders, dwelling 300,000, liability 100,000, medical payments 2500/person, uninsured/underinsured motorist 100,000,collision and other than collision (100 deductible)
    Personal risks:
    Life – my husband employer paid group term 50,000, we both have 50,000 universal life policy
    disability – mr. murphy – employer paid group policy (LTD with a 90 day wait with benefits to age 65) I have no coverage
    Medical: My husband – employer paid Major Medical (family plan) myself – i have an individual plan and still pay premiums

    I thank you for whatever you can give me!!

  30. Eboni March 15, 2014 at 9:33 pm Reply

    i was diagnosed recently with a critical illness and would like to inquire on possibly selling one of my life insurance plans
    great information. I was reading my policy and sounds like I might be able to convert the policy also. The insurance company offers critical illness insurance and disability insurance. Would this be a wise option? I’m a single income parent and self employed daycare provider

  31. Ross March 15, 2014 at 9:34 pm Reply

    I’m confused about the differences of term and whole life insurance, and am not sure what companies are reputable to deal with on this matter.

  32. Vanesa March 22, 2014 at 5:56 am Reply

    whole life insurance
    term life insurance

  33. Yetta April 9, 2014 at 4:10 pm Reply

    I want to pay up front for the whole policy to go to my two children and my Love…

  34. Britt April 27, 2014 at 2:06 pm Reply

    Genworth is in financial trouble.

    Their bonds have been downgraded to Baa1 (still investment grade, but I would expect better from an insurance company)

    Stocks in the tank.

    Losing ludicrous amounts of money.

    Their insurance ratings are still decent, but those rating companies give just about everyone an A or higher, so I don’t trust ’em.
    http://online.wsj.com/article/SB122641820309017419.html?mod=googlenews_wsj

  35. Emerita April 27, 2014 at 4:47 pm Reply

    My mom has term life insurance for 10 years for New York Life.. is it true that in 10 years, she’ll be able to renew it another 10 years? Won’t that be more expensive? Also, what happens if you buy that 20 year term insurance and you don’t pass away until 21, 22 or even 30 or more years? What happens to all your money, and isn’t there a way to renew it? I heard that it would cost thousands and thousands more to renew it after 20 years.. Also, what about universal life insurance? I hear it’s no good, but my mom wants to buy that too.. Can anyone please explain a bit?

  36. Vern April 30, 2014 at 12:05 pm Reply

    I am looking for a life insurance policy. I am 22 years old, have never used tobacco, in good health, etc. I feel like this would be an ideal time to get a good premium. The problem is that I don’t know that much about it. I know there are different kinds. I don’t think I would want term life insurace, right, because I am so young? I want a policy that will be good fir the rest of my life, however long that may be. Any advice? Thanks in advance!
    I have 3 kids by the way

  37. Kori May 1, 2014 at 6:24 pm Reply

    When I was 25 and my husband was 26 we purchased whole life insurance. This was due to a family member working for Mass Mutual and we were getting it through him. His family has decent money and whole life was the recommendation of his father.(I trust that he knows best ) So years later almost 30…I’m looking into all this mambo jumbo stuff that makes no sense to me and am wondering if we should’ve gone the term life rout. We pay about 100 bucks a month for each of us being covered with 500,000. The both of us and I would like to know if we made the wrong decision??

  38. Chandra May 2, 2014 at 8:56 pm Reply

    Anyone heard of this or has it? I’m thinking of getting this type on insurance but am unsure. Are all life insurance cut and dry or what? I know we can’t afford whole life so that’s out of the question. Thinking of AIG ROP term for 30 years. Currently am 28, 2 kids, healthy.

  39. Hal May 6, 2014 at 2:50 pm Reply

    Why you would be better off buying a 20 year term life insurance policy at age 25 rather that buying a one-year renewable policy?

  40. Jona May 8, 2014 at 10:44 am Reply

    Wanted to know if you could have multiple without it being a problem upon a claim.

  41. Marianne May 11, 2014 at 5:48 am Reply

    i am wanting to cash in a 14year life insurance policy. the amount is $50,000. what is the formula for a cash out, in other words how much will i receive?

  42. Collen May 15, 2014 at 10:08 pm Reply

    Is it true that when you turn 60, your life insurance carrier makes you have a mandatory physical, and if you do not pass they do not renew your policy?? That seams awfully fishy to me. My mother in law is very ill, we are concerned about the future of my father in law, he claims he cannot collect her policy because this happened to her….I dont know if I trust him, he seems pretty out of it, with worry. Anyone know?????

  43. Lavern May 18, 2014 at 6:08 am Reply

    im married, age 27 and interested in buying life insurance for me and hubby.
    for just myself how much would my monthly be approx? im healthy dont smoke and dont want to pay too much money….
    does term life give you an option of continuing on with them after the 20+ years term? would the premium go up?
    i only need around 100, 000 i think. since i dont plan on dieing anytime soon but wouldnt want my family with no funeral money if i did. do my kids need any? they are 2 and 4 and i was considering the gerber life for them?
    please help!

    oh hubby is 27 and healthy non smoker as well

  44. Arletha May 18, 2014 at 11:10 pm Reply

    I have Term Life Insurance for my husband. I have recieved a letter, stating that I may want to change this policy to Permanent Life Insurance. Why would I want to do this, what is the benefit or difference between the 2?

  45. Cordia May 26, 2014 at 10:31 am Reply

    Could anyone, e.g my ex-wife, open an insurance policy for me and make herself the beneficiary without me knowing. If that can be done how can I confirm that there is such a policy?

  46. Renay May 29, 2014 at 5:37 am Reply

    I’m 29 years old and I’m married, we are wanting to buy life insurance but I need the best option for my family.

  47. Man June 3, 2014 at 9:01 pm Reply

    I am going to the Middle East next month for 10 days.
    I want to purchase life insurance before I go. If something happens to me on the trip could my family collect the life insurance money? Or is there a certain amount of time you have to have the life insurance before you collect? Would they be eligible to collect if I die in another country? Just a few questions to see if it would even be worth getting life insurance.

    Thanks!

  48. Carrie June 11, 2014 at 3:34 pm Reply

    I want to leave some money for my children once I am gone. Is it better to buy a Term Life Insurance policy or to invest that money where it will earn interest? What are the odds of a Term Life Insurance Policy paying out? What percent pay out? I’m thinking it is probably very low. So I am leaning more toward investing the money instead of using it to pay premiums. It seems insurance is more of a gamble than an investment. I don’t want to give my money to an insurance company for 20 years and have my children get nothing in the end. Can someone with knowledge of the insurance industry please give me a straight answer to this?

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