3 benefits of term life insurance

Benefits of term life insurance
Term life insurance is one of the most well-known and popular life insurance types, largely due to its unique benefits.  Nicolas Hansen/Getty Images

Life insurance comes in all shapes and sizes. Depending on your personal financial situation, long-term goals and beneficiaries, however, there may be one type that’s more advantageous.

While policies range from term to whole to universal and variable, it’s the first on this list that many find to be the most cost-effective and reliable.

Term life insurance policies are limited to a select time frame of the policyholder’s life. Terms can be 15, 20, 30 years or some other agreed-upon time frame. If the policyholder dies during one of these periods then the policy is paid out to the beneficiaries. If they don’t, and the policy isn’t upped for another term, then no payout will be issued.

Term life insurance is one of the most well-known and popular life insurance types, largely due to its unique benefits. If you think you would benefit from getting a term life insurance policy then reach out to an insurance expert. Get started with a free quote. 

3 benefits of term life insurance

Here are three benefits of term life insurance policies to know. 

  1. Cost
  2. Flexibility
  3. Easy to understand

Cost

Term life insurance is perhaps best known for its reasonable cost. For a relatively inexpensive monthly fee (think less than $50, typically) policyholders can sign up for one of the aforementioned time frames. 

Term life insurance is generally less expensive because it doesn’t have a cash option. There’s also a chance you’ll outlive the specified term and not renew, which means the insurer won’t have to pay out anything. Compare that to whole life insurance, which is more expensive, but will cover the policyholder for their full life span. These differences will be reflected in a lower rate.

Read more  9 Science-backed Health Benefits of Plums

Explore your term life insurance options now by using the table below.

Flexibility

Maybe you only need (or want) life insurance for the next few years. Maybe you need it for the next few decades. Either way, you may not need it forever. Term life insurance gives you the flexibility to have coverage as long as you want. 

With terms ranging from one to 30 years, there’s a whole spectrum of coverage options to choose from. Just make sure to start early. Term life insurance is often more beneficial for younger people when rates are low and health issues are minimal. 

Easy to understand

Life insurance policies, costs and coverage options can quickly become confusing. This is especially true for those with cash and investment options. While these may be beneficial, once a substantial amount of money has been saved they can be stressful to manage.

Variable life insurance policies permit you to invest your cash value in various securities and stocks, which allows you to grow your account and death benefits over time.

But this can also become burdensome to track, particularly in a volatile stock market.

Term life insurance is simple. It will protect your beneficiaries in the event of your death. You just pay the insurer to keep coverage and don’t need to worry about anything else. And you won’t be tied to it longer than you need (or want) to be.

The bottom line

Life insurance is advantageous for a variety of reasons. However, benefits are specific to your individual circumstances. If you want a cost-effective, reliable and simple-to-understand life insurance plan, term life may be your best bet.

Read more  How term life insurance works: The basics

Speak to a life insurance expert today who can help you get started with a free quote. 

References

Recommended For You

About the Author: Tung Chi