Term Life Insurance : What You Need to Know!

Life Insurance holder of a policy pays a premium, for a period of time (term life or "pure insurance"), from one to thirty years. Any time, during the term of the policy, if policyholder dies, then beneficiary (ies) receive payment. Term life is the easiest form of life insurance. At the end of the term, holder may renew their life insurance policy, assuming the policy has that renewable feature. "Free-lock" period usually ten days, after you receive your policy, you have the option to cancel. Before obtaining policy, applicant will have to be medically evaluated, and again upon renewal, to be qualified to obtain term life insurance. However, if policyholder health is poor, may not qualify for this insurance or renewal. The premium amount is calculated, based upon age, gender, health questionnaire, and physical examination, determines the approval of certificate of insurability. Typically there is 30 or 31 days grace period, if a premium is paid late, however if a premium is not paid, then the policy is cancelled. Advisable to include in the insurance policy a provision or rider, which stipulates that if the policyholder becomes totally disabled for a specified period of time, do not have to pay premium, for the duration of the disability.

Renewing term policy, have an increased premium amount, because of the age of the policyholder. Otherwise, Permanent life insurance policy continues coverage, until the policyholder dies. Always good idea, to lock - in a Long Term policy, which premium stays the same, during that time. Most term policy, have the option to convert to whole life insurance or type of insurance policy. This maybe important, if the policyholder health declines, which would make it difficult to renew to term life, but easier to convert to another type of policy. Conversion usually allowed until age 65. Beware insurance agents will more likely, encourage to buy Whole Life Insurance, where the commission is several times higher. Term insurance does not accumulate cash, as with whole life insurance.