It is an undeniable fact that life insurance has now become extremely important in a person’s life. But unfortunately, many people tend to avoid it despite being fully aware of its importance. Most people stay away from availing life insurance because they just do not get into the complexities of the policies. They actually just cannot figure out from where to begin in order to avail a life insurance quote. However, one must not allow these reasons to stand as an obstacle to ensuring a secured future both for that person, as well as his family members. Getting free life insurance quotes is the first and most essential step for availing that insurance policy which is the most suitable one for you. There are various online insurance companies, whom you can get in touch with via the internet. There, you can access several insurance quotes, and you will not be charged anything for that. What these websites will also do is make a comparison between numerous insurance policies and thereby, helping you to select that one which is the most appropriate and cost saving.
What is term insurance?
Term life insurance is certainly one of the most commonly used types of life insurance quotes available online. A simple definition of this type is that it is a policy which offers death benefits after the death of the policyholder, within a specified policy term. This policy’s rule is that if a person lives for than the years that have been specified by the policy, the beneficiaries of the person will not be paid any amount by the company. There is no investment feature or cash value associated with this type of policy. It is this property of the policy which makes it very affordable, particularly during the initial years. But the cost of the premium can increase with the age of the policyholder, or when the policy is renewed. Along with that, some people can find it impossible to renew the policies because of change in certain conditions like the person’s health.
Types of Term Life Insurance Policies:
Guaranteed Level Term Life Insurance
Guaranteed term level insurance policies are the most common type of term life insurance that people opt for. Working with this kind of policy is pretty simple. You pay yearly premiums that are fixed and do not change with passing years. However, the renewal benefits of such policies are restricted. You can usually withdraw this policy after a certain period of time; say 10, 20, or 30 years as stated in the insurance policy. For longer-term policies, the premiums usually get higher with each year.
Annual Renewable Term Life Insurance
An annual renewable term life insurance, or ART, is a short-term life insurance coverage that can be renewed every year, but for a defined period of time. After the policy is renewed, the premiums go up and keep increasing with each year. The premium increases dramatically after a period of 20 or 30 years.
Return of Premium Term Life Insurance
The return of premium term life insurance is a special kind of insurance policy that refund the life insurance premium once the term period ends. If the insured person is still living, he/she gets the premium amount refunded after term period completion. Such policies are available usually in 15, 20, or 30-year terms. Compared to other term life insurance policies, the return of premium policy might look a bit pricier but is definitely cheaper than a whole life insurance quote.
Decreasing Term Life Insurance
In a decreasing term life insurance policy, there is a yearly fall in the cover level till getting to zero. This type of cover is mainly used for repaying the loans. It is typically designed to pay a lower claim as the policy ages. Death benefits keep decreasing in such kinds of policies. This is because a decreasing term life insurance policy is for individuals who have higher financial responsibilities and burden currently, which may decrease over time such as mortgages.
Modified Term Life Insurance
As the name suggests, a modified term life insurance is only a modification of the standard life insurance plan, with a twist. A modified term life insurance policy uses an alternative payment structure to the standard life insurance plan while offering the same protection. An individual has the flexibility of either paying increasing premiums over time, or modify the same like a decreasing term life insurance plan and pay lower amounts of premiums with time. This kind of life insurance policy is not feasible for everybody as careful planning and consideration of personal and professional life is required.
Final words:
When you’re choosing a term life insurance quote, do so carefully and wisely. But before doing anything, you must understand and be aware of what type of coverage you wish to go with and why. Understanding the kinds of term life insurance policies will help you determine the plan that is best suited for you and why such policies can offer you greater benefits than whole life insurance plans.