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Term life insurance provides coverage at a fixed rate of payments for a limited period of time. After that period expires, coverage at the previous rate of premiums is not guaranteed. In most cases, this type of insurance is designed to cover temporary needs such as paying off a mortgage.
A typical term life insurance policy lasts 20-25 years, although they are also available in 5, 10, and 15-year terms as well as to age 65, 75, or age 100.
At the end of the insurance term, depending on the type of policy, you may be able to convert your policy to a permanent form of life insurance. While initially inexpensive, the cost can increase significantly over time. Clients that are planning to use insurance for longer-term needs should consider either whole-life or universal life insurance solutions.
Benefits of term life insurance:
Help pay off the mortgage or other debts
Protect your family’s financial future
Pay off business loans or lines of credit if a business owner dies