What is term life insurance?

[Knowlopedia]

Term life insurance is a life insurance policy that provides coverage for a specific period of time, typically 10, 20, or 30 years. If the policyholder dies during the term, the beneficiaries will receive a death benefit. If the policyholder does not die during the term, the policy will expire and there will be no death benefit paid.


Term life insurance is the most basic and affordable type of life insurance. It is well suited for people who need coverage for a specific period of time, such as when they are starting a family or paying off a mortgage.


Premiums for term life insurance are based on the age and health of the insured, the coverage amount, and the length of the term. The premium will increase as the insured gets older and/or if the coverage amount is increased.


There are two types of term life insurance: level term and decreasing term. Level term life insurance premiums are the same for the entire term of the policy. Decreasing term life insurance premiums start out high and decrease each year, coinciding with the decreasing amount of coverage.

 

[Mika]

Life insurance policies can be broadly categorized into two types, whole life insurance policies, and term life insurance policies. While a whole life policy does not have any ending time, term life insurance, as the phrase suggests, has an ending term. Whole life is for the entire life, whereas term life is for a fixed term. Term life is for those who want to get financial coverage when they become terminally ill, become invalid due to accidents, etc. This type of insurance policy is also for people who want to get insured amount along with the benefit and use the money for their own benefit.