What is Term Life Insurance?
Term life insurance is the most simple
insurance plan, compare to some other types of life insurance. It is
considered a non-participating policy and hence, it does not have the
cash value usually. By choosing the amount of coverage you intend to
purchase and the number of years you want your coverage to be, you are
then covered, with the premium paid.
Unlike whole life insurance plan, term
life insurance is normally a shorter term insurance policy with
coverage period ranging from 5 to 30 years.
Term Life Insurance Benefits
Term life insurance is simple and easy to
understand. Therefore it is much easier to make a decision. You only
have to choose the period and amount of coverage. Basically, what you
need to know is how many years you are covered, for how much are you
covered and how much do you need to pay for as the premium.
Term life insurance is the relatively
most inexpensive to buy, compare to other types of life insurance
policy. You can cover yourself with large coverage by paying low
premium. Some people may have thought that they could not afford life
insurance premium and therefore do not cover themselves sufficiently.
Term life insurance is just the perfect match for these group of
people, who have had only limited budget allocated.
Another good point about term life
insurance is you do not have to depend on insurance company to invest
for you. You can choose to do your own investment. Most of the
financial planners advise their clients to buy term life insurance and
invest the residue amount elsewhere. They agree by doing that, the
clients are able to get better return compare to buying a whole life
insurance policy.
There are also insurance companies who
make some enhancements to the term life plans. Some term life insurance
policies have had the premium return features. If there is no claim
after the coverage period of the policy, all the premium paid will be
refunded. This makes term life insurance even more attractive.
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