Why Term Life is Good Life Insurance

Term life insurance is a brilliant option if used appropriately. Some say a key disadvantage to using term policies is that they typically last for a limited period. However, when these temporary policies are coordinated with similar length risks the consumer gets a lower cost premium and higher death benefit for their beneficiaries when compared to permanent policies on a dollar for dollar basis.

To coordinate a policy with your mortgage you can simply purchase a policy with a term similar in length to the term of your mortgage. As an example, a consumer who has a mortgage payment for the next 30 years buys a 30-year term.  This term purchase covers the risk of losing the mortgage payers income if that person dies and would leave the beneficiaries enough to cover mortgage expenses or even replace the bread winner’s income in the event of his or her death.

Apart from the cost savings, Term policies have added benefits as Insurance companies’ today engineer additional benefits apart from just the traditional death benefit. In today’s market place, cheap term life insurance policies have different contract time periods to match risk consumers may face and riders which offer waiver of premium in the case of disability, and may even return all premium at the end of the Term. It is therefore important to consider that term polices vary from one insurance company to another in terms of price, underwriting requirements, and other feature such as policy riders.

When considering the price look at the price per face value in addition the underwriting requirements that one gets, as these vary from one company to the next. This means that a prospective customer may see their premium change from one company to the next or may be insurable in one insurance company but uninsurable in the next.  This is because premium charged depends on insured health condition and the underwriting requirements of the company, and some companies are simply more affordable. General however the healthier you are the better the rates one should be able to get. However, paying attention to the underwriting requirement and shopping around can yield some added savings.

Policy riders which is a provision in an insurance policy that adds additional benefits at an added expense to payor of the policy.

One policy rider that may add value to a term policy is the return of premium rider which return all premium paid over the term back to the owner of the policy. This means the consumer gets protection while they have the policy in the event of death of a covered person and their premium is returned once the policy is not needed. Key to note however is that premium returned is without any additional earned interest and hence there is an opportunity cost to consider when purchasing the return of premium rider.

Another valuable option to add is the waiver of premium rider which is a provision in an insurance policy that waives the policyholder's obligation to pay any additional premiums in the event of illness or disability.

Term Life Insurance offers the least expensive option to give protection to your dependents. It has permitted people with a limiting income to purchase policies with larger face values. And give consumers added benefits with new engineered feature built in these policies. Additional Saving can be realized from using comparison shopping online in a quote engine that pull rates form various insurance companies.