Health Insurance Blog

Term life insurance is similar to renting a home vs. purchasing it. Once the rental period (term) is up, the policyholder has no equity. Term life insurance policies build no cash value and therefore the coverage is relatively inexpensive as compared to permanent insurance policies. Many people purchase term insurance to insure for a specific event such as a mortgage, business buyout or children’s school aged years.

Term insurance can be used as a way to afford some type of protection while saving for a permanent policy. Other people feel it’s a cost effective way to protect them while still being able to keep their other investments.

Term Insurance Coverage Options
The following are a few things offered with most term policies.

Level Premiums: Companies offer level premiums over the term of the policy meaning the premium can never be increased or decreased; it remains the same for the term of the contract.
Convertible policies: Term policies may be converted into permanent insurance prior to the term expiring.
Waiver of premium is one important rider usually offered with Term life insurance. If selected, the insurance company pays the premiums of the policy in the event the insured becomes disabled and can no longer pay the premiums.

5 Things you must know about life insurance

We polled 50 Life Insurance Agents and asked them: ‘What 5 things MUST you know BEFORE buying Life insurance?’ Here is what they said…and more!

5 Things…In no order of importance:

1) Coverage Amounts

Do you know how much coverage you need or are you just rounding and guessing. It seems like the life insurance business has turned into multiples of $100,000. Don’t take the easy way out and just guess at a number.

2) Know the difference between permanent and term life insurance

Term Insurance is temporary insurance and will expire at some point.

Whole Life insurance is for your ‘whole life’ as long as you continue to pay the premium. In addition to the life insurance death benefit, It does have an ‘account’ that earns interest

3) Is It Too Late to buy Life Insurance?
It’s critical to buy life insurance when you can. Depending on how much coverage you want and how old you are, life insurance can be difficult to get.

4) Smokers pay higher premiums.
You can’t smoke in buildings anymore, you get naughty looks from people who get the slightest whiff of your smoke, and you generally are looked at as unhealthy. Unfortunately, we don’t have any good news here. Life Insurance companies do not like smokers. Premiums reflect that. You will pay dramatically more for a life insurance policy as a smoker than as a non-smoker

5) Keep up with changes in your life.
Don’t forget to do a review of your life insurance every couple years. At a minimum, review your life insurance program when major changes occur (birth of a child, significant change in household expenses, etc.).