Level Term Life Insurance

Level Term Life Insurance!

What is level term insurance?
Who should consider level term insurance?

What is level term insurance?

Guaranteed Level term provides guaranteed coverage for a selected period of time. The face value of a level term policy remains the same for the amount of time you have selected for coverage as does the premium. Coverage can be as little as 1 yr to 30 yrs. Level term insurance is more common than annual renewable term life insurance however the premium is based upon the summed cost of each year’s annual renewable term rates with a money adjustment determined by the insurer and driven by a time value.. What does that mean to me? What that means to you is the longer your term policy premium is level for, the higher the premium; because the older, more expensive to years to insure are averaged into the premium. You’ll find that most level term programs include a renewal option and allow the insured or level term policy holder to renew for a maximum guaranteed rate if the insured period needs to be extended. Typically though, this clause is invoked only if the health of the insured deteriorates substantially during the coverage period. Once the term period is chosen you cannot change it. If you still need protection after your term period is over, you may renew your coverage each year up to age 95 (New York is less.) You many also convert your term policy to a permanent life insurance such as whole life, universal life, or variable universal life policy to accrue cash value.

 

Who should consider level term life insurance?

  * Level term is ideal for individuals who know they need coverage for a certain number of years or who are uncertain of their long term goals but desire an affordable solution today.

  * Level term is also ideal for individuals who know they need coverage for a fixed number of years, a small business owner for example who needs a short to moderate term risk to cover.

 *CONSUMER TIP: Look for policies that offer a guaranteed fixed premium or term premiums that DO NOT rise over the coverage period. Some policy’s don’t provide premium-rate guarantees and the insurance company can raise the premium during the specified term of coverage. These increases are intended to account for the rising probability of the insured’s death in any given year.

 Looking for other types of Term life insurance? Annual Renewable Term Life Insurance