Choosing a Term Life Insurance Policy
Choosing a Term Life Insurance Policy
So you are planning to invest in life insurance policy. But you are bothered about the high premium rate. Why don't you consider term life insurance? They are quite affordable as compared to whole life insurance. In a term life insurance you are covered for a certain period of time. If you die within that specified time limit, your beneficiaries will get the compensation. It would help your family a lot, especially if you are the earning member of your family.
Before you buy a term life insurance policy it is crucial to do a little bit of research to make sure that you are choosing a policy that best suits your needs. Just because the premium rate of a policy is low, don't jump for it. Go through the details to ensure the benefits you are going to get are worth your investment.
Here are a few tips that would help you to choose the right term life insurance policy.
When you decide to buy a term life insurance policy the first thing to determine is the time period you would like the policy to last. Term life insurance policies usually last for 5, 10, 20 or 30 years. Your premium rate will also depend on the time span of your policy.
Next you should consider your monthly income. This will help you to understand how much premium you can pay. This will also help you to realize how much coverage your family will need in your absence.
The premium rates may vary depending on several factors such as your age, your health condition, your family's health history, whether you are a smoker and so on. Talk to your agent regarding these factors.
Ask the agent about the availability of riders before you buy the policy. These are added advantages for which you need to pay some additional premiums. For example if you become disable in an accident you will not have to pay premiums for the policy but you will get the benefit.
The most important to thing to keep in mind while buying a policy is whether it is convertible or simply renewable. If it is only renewable, it means you can extend the time span of the policy be renewing when the term comes to an end. On the other hand if the policy is convertible, it means that you can convert the policy into whole life insurance policy to remain insured throughout your life. But in that case the premium rate will increase.
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