Term Life Insurance is the simpliest and most common form of life insurance. The policy is designed to provide coverage for a specified period of time, for example 10,15.20,or 30 years. Thus when buying a term life insurance policy one should be aware of how long they would need the coverage and what amount of term life insurance coverage. would be adequete for their personal insurance needs.
Like all other life insurance products, term life insurance rates are based on the health of the individual applying for insurance. Therefore the insurance companies have the proposed insured complete a medical exam before offering them an approved rate. The medical exam along with all previous medical records obtained from their doctors and hospitals are reviewed by an insurance underwriter and used to determine the appropriate health class. Below are examples of policy rate classifications and average premiums based on the sex and whether or not you are a smoker.
Term Life Insurance is less expensive then many of the other life insurance products available. Provided below are some examples of average premiums.
Average Rate for a 45 year old male for $250,000 of term insurance guaranteed for a 20 year term is $387.50, if that male has no existing medical conditions and does not smoke. If he were to smoke the rate for that same male would increase to $1,072.50. It becomes substatially higher.
Average rate for a 50 year old male, whom is also in good health and wants to apply for the 20 year $250K policy those rates would be $585.00/ annually for a non-smoker and $1,667.00 for the smoker rates.
When buying life insurance, you have the option of purchasing a policy for a predetermined time span (most common are: 10, 15, 20, and 30 year terms), this type of insurance is known as term life insurance. Used as a basic, relatively inexpensive way of providing financial protection, a term life policy is particularly attractive to younger people who cannot afford the higher premiums generally associated a permanent policy, or a guaranteed life insurance policy
Term life insurance has several other advantages which must be mentioned. The first is flexibility, when you buy a term life policy, you choose both the amount and the duration of your coverage.
Another aspect of a this type of policy, that may appeal to you, is a guaranteed rate of premiums. The premiums will not change over the term, regardless of the term's length. Note that some insurance providers may offer variable insurance rates, in return for lower premiums.
As it would be with any other insurance policy purchase, your insurer will require you to undergo a medical exam before you are approved for the policy. Some term life policies will allow you to renew the policy upon its expiry, without a new medical.
A term insurance policy may be your best option if you have others depending on your income and support and don't have much disposable income. Your unique needs will determine the exact balance between the length of term, amount of coverage, and acceptable premium rates.
The premium rates will vary a great deal, both from policy to policy and from provider to provider. Finding the right policy can be a time-consuming and complicated process, but not going through with the search can mean that you purchase a policy that is not well-suited to your financial needs. We can help by providing a free, no-obligation term life insurance quote.