Term Insurance
Term Insurance is designed to provide financial protection to your beneficiaries in the event of your death during the term of the policy.
Key points about Term Insurance :
1. Duration:
Term insurance policies are typically available for terms ranging from 5 to 30 years, although some insurers offer terms of up to 40 or even 50 years.
Once the term ends, coverage ceases unless the policyholder renews the policy or converts it to a permanent life insurances policy.
2. Death Benefit:
If the insured person dies during the term of the policy, the insurances company pays out a death benefit to the designated beneficiaries.
This benefit is usually paid out as a lump sum, although some policies may offer other payout options.
3. Affordability:
Term insurance is often more affordable than permanent life insurances, especially in the early years of the policy. This is because term policies do not have a cash value component like permanent policies do, and they are designed to provide pure death benefit coverage.
4. Renewability and Convertibility:
Many term insurances policies offer the option to renew the policy at the end of the term, typically at a higher premium.
Some policies also include a conversion option, allowing the policyholder to convert the term policy into a permanent life insurances policy without undergoing a medical exam.