A term policy is an insurance plan that covers life for a particular term in one’s life. It is a policy that provides coverage for a particular period of time in your life against the monthly or yearly premium you pay to the company. If one dies, or if the insurer dies during the time period stipulated in the policy agreement, that is the term policy agreement, one gets the death coverage. Within this particular period, the term policy must have been active. So, this is one thing one has to ensure. As long as the payments of premium are paid, the term policy remains active.
Term policy insurance is much less expensive than a general life insurance plan. There is no financial gain to the insurer at the end of the term if the insurer is alive. This is why the premium is lower compared to other plans. Even though there is no end benefit, one should go for it because of the death benefit your family gets. Even if you are not around and not earning, the financial comfort that you otherwise would have provided will continue thanks to a term policy.
There are many types of term life insurance policies. All that you have to do is select the best company and the plan. Once you are into it, you remain to rest assured about the financial security of your family when you die. There are policies that are known as level term policies. There are level premiums for a fixed period of time. A premium is the amount of money that you usually pay every month to the insurance company. The policy remains alive as long as the premiums are paid.
There are different types of term insurance. There is one convertible term policy. Under convertible term policy, the policy can be converted into life insurance. It means that the fixed term policy can be converted into a full life insurance policy. The benefit of this type is that the insured person is not required to produce medical certificate during the conversion of the policy into different form.
There is another type of term policy. This is known as an increasing term policy. The benefit of this policy is that the death benefit can be increased during the continuance of the policy. The term policies are renewed every year. Every year the premium increased to certain extent but the death benefit remains the same.
The term insurance policy is advantageous because there is death coverage. Even after the demise of one, the dependents of one will continue to have the financial benefit. The insurance company will pay the benefits to the beneficiaries after you pass away.