Term Life Insurance

Term Life Insurance provides protection for a specified period of time, 5 years, 10 years, 20 years, or until a specified age, and it usually starts at a lower payment but the premiums increase as the insured gets older.

If the insured dies during this time frame, the benefits are paid to the beneficiary, but if he does not die within the specified time, no benefits are paid to anyone.

There is usually no cash value associated with term life insurance but some policies can be converted to a cash value up to a certain age without a physical examination..

Term life insurance is good for people who have limited funds and may need insurance for a certain period of time.

Some policies are renewable for additional terms but each time it is renewed, the cost of the policy increases based on the insured's age.

Some term policies may be converted to whole life insurance up to a specified age but usually at a higher cost in premium.

Under term insurance, there are two sets of premiums, current and guaranteed maximum.

Guaranteed maximum premiums are set forth in the term life insurance policy.

Current premiums are somewhat lower but can be changed by the insurance carrier. Current premiums cannot be increased above the guaranteed maximum premiums shown in the policy.

As stated above, the cost of term insurance increases as you get older, but it serves a purpose for those who need insurance and can't afford a whole life policy for the amount of insurance they want.

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