Affordable Term Life Insurance Is The Best Way To Protect Your Family.




Affordable term life insurance is the most economical way to provide significant and adequate protection for your family and loved ones.

The high cost of some life insurance policies can limit your ability to adequately protect your family.

As discussed previously on the "Life Insurance Matters" page of this website...

Your most important asset is...

Your ability to make money and provide a continuing income flow for your family.

Therefore, the question is...

What would be the financial impact of your death to your family?


How would they fare if your paycheck stopped coming?

Mourning a death is much worse when accompanied by financial devastation.

The purpose of life insurance is to address that potential situation.

I believe that providing adequate life insurance protection is an awesome, tangible expression of your love for your family.



There are basically two major types of life insurance products... affordable Term life insurance and Whole life (cash value) insurance.

Some commonly seen variations of term insurance are... annually renewable, level, group.

In addition... some commonly seen variations of “cash value” insurance are... whole life, universal life, variable universal life.

Click here for a more detailed discussion of Whole Life Insurance.

For now... let's focus on affordable Term Life Insurance.

If you are wanting to protect your family in the event of your death... then the absolutely best way to do that is to buy an affordable term life insurance policy.



Why Term Insurance?

First... a term life insurance policy provides a "death benefit" and nothing else. It does not build a "cash value" over time.

If the insured person dies... the beneficiary will be paid an amount equal to the "total amount of coverage" the policy was written for.

That's it... you know what you get... no gray areas... no complicated formulas... no conditions.

Term policies are simple... easy to understand... and straight forward. "Cash Value" type policies are much more complicated.

Next... for the same amount of premium... you can have much more coverage through an affordable term life insurance product compared to a cash value type product.

How much more?

Generally... in the area of about three times as much more protection for the same monthly premium amount.

If... upon your death... you want your family to have as much financial support as feasibly possible... then affordable term life insurance is the type of life insurance product that you need to own.



How Term Insurance Policies Work And How To Consider Them.

To start with... it is important to understand that the premium that you pay for a term life insurance policy goes strictly to paying for the coverage provided by the policy.

In other words... it is not adjusted or increased in order to pay for some other feature or option. This is one of the major reasons that term life products are less expensive than "cash value" products.

The sole purpose of a term life insurance policy is to provide a "death benefit" for the beneficiary. The "death benefit" amount is equal to the amount of coverage.

There are several variations of term insurance.

The version that is ideal for most families is "Level" term (coverage stays level) insurance with a premium guaranteed not to change for a specified period of time.

Most insurance companies offer affordable Level Term Life Insurance Policies.

It follows that... for a given amount of coverage... the premium (cost) will vary depending on the "premium guaranteed" timeframe.

In other words... the cost for a 10 year premium guarantee will be less than the cost for a 15 or 20 year premium guarantee.

The longer the premium guaranteed period, the higher the cost (premium).

Generally... it is best to lock in your premium for as long as possible. However, everyone's needs and financial situations are different.



How Much Do You Need?

Decide what you want for your family financially... in the event of your death and then... determine how much coverage would be required to protect them in that manner.

In other words... if you died...would you want to provide your spouse with enough money to pay off all of the debt?

Would you want your spouse to have a certain amount of monthly income for a certain period of time if your paycheck was no longer available?

How about money for college for the kids?

What about money for funeral expenses?

Next... consider how long you will need that amount of coverage. Remember, you can always reduce your coverage at any time in the future if your protection needs decrease.

For example... you might not need as much life insurance protection once the kids are raised and on their own.

Or, you might not need as much coverage once you are out of debt.

The point is... as our lives change, so do our protection needs.

Do this sort of exercise in regard to... what if you die? Then repeat it in regard to... what if your spouse dies?

The results tell you how much coverage would be required on each spouse in order to protect the survivor(s) in the event of either spouse dying.

Evaluate your own particular need using the insurance calculator provided by the following link. Carefully read the link instructions before clicking to the calculator.
To determine how much coverage you need... first click here.
Then select the "Life Insurance Needs Estimator".


Once you know the amount of coverage needed on both you and your spouse... go buy some affordable term life insurance.

But first... consider the following "must have" feature.



Do Not Buy An Affordable Term Life Insurance Policy Unless It Has This Feature...

By far... the most important provision that your term life insurance product must have... I repeat... it must have... is a guarantee that it can be "renewed as" or "exchanged for" another "like policy" (ie, a term policy with same provisions as before) at the end of the "premium guarantee" period. Without having to prove your health again.

You must be able to renew your policy regardless of your health.

There are affordable term life insurance policies that give such guarantees and there are term policies that do not.

If you already have a term life insurance policy... make sure that it provides the above option.

Look through your policy to find out what your options are at the end of the "guaranteed premium period".

Some policies require your health to be re-evaluated at that time in order to retain coverage. This is NOT good.

Who knows what your health will be 10, 15, 20 years from now?

You do not want to be required to "prove your health" at some time in the future. Make sure your policy makes no such requirement.

Some insurance companies only allow you to exchange your policy for a whole life product. This is NOT what you want.

A whole life policy for the same amount of premium means that you will have a lot less coverage for your money.

Let just say that the only acceptable exchange or renewal option that you should consider when shopping for affordable term life insurance is... the option to renew or exchange your policy... at the end of the "premium guaranteed" time period... for the same type of term insurance policy.

And... without having to again "prove your health".

In addition... make sure that you will obtain a new "premium guarantee" for a new time period at renewal.

And... the new premium rate will be based on your current premium class adjusted for your current age.

You will probably have to communicate directly via phone, email, etc. with the insurance company to determine whether these features are part of their policy.

Most companies do not advertise these important features.

However... it doesn't require much effort to find out what you need to find out. It is definitely worth your time.



Other Important Considerations

Please take the time to also consider the following related subjects along with the information provided in the current discussion about affordable term life insurance.

Click here for an important discussion about... Group Life Insurance.

Click here for an important discussion about... Owning Your Own Life Insurance Policy.

Click here for an important discussion about... Your Insurability And When Is The Best Time To Buy.



So, in summary...

An affordable term life insurance policy provides the best way to adequately protect your family from the financial disaster of losing their greatest asset...

Your ability to make money and provide a continuing income flow for them.

Act now... before you are any older and before your health changes. Affordable term life insurance will never cost you less than it does today!

"Because It Matters"... Jim

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