In order to guard your family against financial crisis, you really should strongly consider purchasing life insurance for yourself and your spouse. There are many different options for life insurance and it can be extremely confusing with all the terms, conditions and choices that you just don’t know much about. A life insurance broker can help you wade through all these options, but at the end of the day, low cost term life insurance is almost always going to be your best option.
Term life insurance is simple to understand and it is simple, yet effective in operation. Unlike some of the other expensive options such as whole life insurance or variable annuity life insurance, term life is just life insurance with no investing aspect involved. Somewhere along the line some company must have decided they could make more money out of clients if they made a convoluted insurance and investing policy and that’s where those choices arose from.
Term life insurance is a policy that you buy for a set period such as 10, 20 or 30 years. You buy a face value amount of the policy, also known as the death benefit, in increments of (usually) $100,000. So you could see a $700,000 policy or a $400,000 policy. Each year you pay an amount to keep the policy in effect and this is known as your premium. As long as the policy is in effect and you are timely with your payments, you will have this life insurance until the end of the term. If you die during the term, the insurance company will pay your beneficiaries the face value of the insurance. It’s really that simple.
If you like the thought of having great life insurance at the lowest possible price then term life is for you. There are some variations on term life that you might want to consider such as joint term life insurance and return of premium term life insurance. These are just minor variations on the traditional policy that are reasonable choices to discuss with your insurance broker.
