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Among The Major Types of Life Insurance, Term Insurance Is the Most Popular

Among the major types of life insurance, term life insurance seems to be the most popular. Why? The answer lies largely in the cost of this insurance type, which is often considerably less than the cost of a fixed life policy. Another reason is that people can often customize term policies to fit their particular needs.

One of the characteristics of term life insurance is that you are paying for protection and nothing more. Unlike some types of straight life or whole life insurance, term insurance does not accumulate cash value. A term life insurance policy is not an investment, it’s all about protection. You’re paying for protection and for protection only. In the minds of many, that’s what insurance is used for anyway.

How Long Does A Term Policy Last? – What do we mean when we say you can customize a term life insurance policy to fit your needs? Typically a term policy once purchased, remains in effect until the policyholder reaches his or her 65th birthday, at which time the policy terminates. There will be no benefits payable if the policyholder lives one day past his or her 65th birthday. On the other hand, if the policy holder dies one day before turning 65, the entire cover amount will be paid to the beneficiary.

It’s possible, however, to purchase term insurance that will provide protection for a specified period of time, perhaps 10 years, perhaps 20 years, or whatever the insurer will agree to. One does nothave to purchase a policy that gives protection until age 65, though most people do. There’s one thing to bear in mind. The cost of the term policy is determined by the duration of the protection provided, and by the age and health of the applicant. The older you are, the more you’ll pay when purchasing term life insurance. Should you come down with a systemic illness, you’ll pay more. Usually, it makes most sense to purchase a term insurance policy while you’re young (and healthy), and purchase one that will stay in effect until age 65.

Especially Suited For Young Families – Term insurance is excellent for young families who do not have much in the way of financial assets or cash reserves, which is probably the main reason for its popularity. There is cheaper insurance out there, specifically accidental death insurance, which as the name implies, has limitations as to whether or not benefits will be payable upon death. There’s guaranteed life insurance also, a less ideal option, unless you are too ill to be able to qualify for any other type of life insurance and can afford high-cost premiums. When looking at the various options for life insurance, term life insurance has a great deal going for it.

We can help you find a term life policy that will fit your needs. Contact us today for a quote. It’s free, and asking for one places you under no obligation.