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Term Life Insurance 101

Term Life Insights on JRC:

What is Term Life Insurance?

Term life insurance is typically the most affordable type of life insurance policy which offers guaranteed level premiums for a set initial period, known a “term”.  It is generally purchased  to cover a short term insurance need (10-30 years) rather than lifetime.

The most common initial terms are:

  • 10 years
  • 15 years
  • 20 years
  • and 30 years

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After the initial term, premiums typically increase annually on an “annual renewable” basis.  This change to annual renewable premiums tends to come with a huge premium increase, so in order to avoid this, most term policies can be converted to a lifetime coverage option, such as whole life or universal life.

What Term Length Should I Consider?

It depends on why you need life insurance.  Term insurance is most frequently used to replace income lost in the event of a family member’s unexpected death.

So if you think you will work 20 more years, a 20 year term policy might be the most suitable product for you.

However, if you need life insurance to cover a shorter term need, such as a business debt obligation, a lower cost 10 year term policy could do the job.

Give us a few minutes of your time, and we’ll recommend the appropriate term length for your needs.  855-247-9555

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