What Is Term Life Insurance?
A death benefit paid to the policyholder’s beneficiaries over a predetermined time period is provided by term life insurance.
The policyholder has the option of renewing the policy for a subsequent term, potentially converting the policy to permanent coverage, or letting the term life insurance policy lapse.
The most important takeaways are that term life insurance ensures that the insured’s beneficiaries will receive a predetermined death benefit if the insured dies during the specified term.
These policies have no other value than the guaranteed death benefit, and unlike permanent life insurance products, they do not include a savings component.
Premiums for term life insurance are based on a person’s age, health, and expected lifespan.
It may be possible to convert term life insurance into whole life insurance, but this will depend on the insurance company.
Term life insurance policies can typically be renewed for an additional term of 10, 15, or even more years.
