How Long Does Term Life Insurance Last?
December 22, 2008 |
Featured, Term Life
Term life insurance is a policy that is only active for a specified period of time. The term life insurance policy will only cover you for the amount of time that you intend it to and then it expires at the end of the term. With some policies you are able to pay extra during the policy’s term and have your premium payments refunded when the terms expires. This can be a good investment. How long are terms on term life insurance policies?
The terms of life insurance policies can vary depending on what your needs are. Term life insurance polices can range anywhere from a year up to thirty years. They can cover a variety of debts and expenses. There are several important reasons for you to consider getting term life insurance as well as different coverage levels and various term lengths for you to select.
You may be wondering why you would ever want a one year term on an insurance policy. There could be circumstances when you have loans or other types of debt that need to be covered. In order to protect your family, who might be responsible for these debts in the event of your death, you can increase your insurance coverage to cover the debt. For example, if you took out a car loan that was to be paid off in one year, that loan might need to be covered in the event of your death if it would pose a financial hardship on your spouse to make the payments. You can get a term life insurance policy that would pay off the car and you would only need coverage for one year. So basically the major purpose of short term life insurance policies is to cover loans or short term debts.
On the other hand you may be wondering why you would need a thirty year term insurance policy? The main reason would be for paying off a mortgage. If you have mortgage payments to make, you will want to ensure that your spouse will be able to continue making the payments if you should die. A thirty year policy should cover almost any mortgage loan term.
Another reason why you might want a longer term policy is if you have young children or planning on having additional children and it may end up being thirty years or so before all of your children are on their own and financially independent. A long term policy will help to keep things financially stable for a family with young children.
Tags: Term Life
