There are a number of term life insurance policies that you can purchase. Which one is the right one for you? This question leads to a more important question. Why am I buying life insurance? If you can answer that question with confidence then you are on your way to selecting the perfect policy to fit your needs. Term life insurance is relatively inexpensive and can cover a multiple number of insurance needs. Term insurance is usually purchased to cover short term or intermediate term debt. We all have ongoing debt in our family budget and so it would be a good idea to always have enough term insurance so that you don’t have to buy the credit term life insurance offered with car loans and other retail purchases.
There is also the need to purchase term insurance for longer term debt like mortgage loans and college education. The leading characteristic of term insurance is the fact that it protects you over a specific period of time. Term policies have time periods. There are 5, 10, 15 and 20 year level term policies. The level term policy has a fixed death benefit during the term benefit period. Decreasing term policies are different. The face amount of the decreasing term policy will decline during the policy period. The rate for decreasing term insurance is almost always lower than a level term insurance policy for the same time period because the coverage decreases.
The key to shopping for term insurance is to make sure that you are comparing the same kind of policy. Do not compare a 20 year decreasing term policy with a 20 year level term policy because they are two different policies. You also need to make sure that you are comparing similar added coverage. Waiver of premium is usually always an option when purchasing term life insurance policies. Make sure that you compare policies with and without this rider to get an apples to apples quote.
Written By: Gavin Bloom
