Types Of Life Term Insurance
By: Joe Stewart
There are actually eight different types of term life insurance available for consumers, although there are a couple differences and one is only sold as a rider. Let me touch on each one of these briefly.
#1. The first five types of term insurance are non-renewable/non-convertible term, which expires at the end of the stated period of coverage.
#2. Renewable term - this policy can be renewed at the end of the stated period without having to have a new medical exam.
#3. Convertible term - this is term life with conversion privilege. It can be changed to one of the higher premium policies such as whole life or endowment at any time.
#4. Re-Entry term - this is the cheapest of all term life policies, if the person to be insured qualifies for it.
#5. Deposit term - this is a 10 year renewable term life policy where you make a deposit at the inception.
In the next two types of term life insurance the face value of the policy remains constant or changes.
#1. Level term -the face value of this policy stays the same. The policy premium remains the same for the entire term of the policy.
#2. Decreasing term - the face value on a decreasing term policy goes down over time. This type of policy is typically used to pay off mortgages and is sometimes called mortgage life insurance.
#3. Increasing term - increasing term life is a policy where the face value goes up regularly each year. Increasing term is only sold as a rider.
Term life insurance is by far the least expensive option of all of the different types of life insurance available, such as whole life, endowment, etc.. All have their advantages and disadvantages. Term life does not build any type of cash value. It's what is known as "pure" life insurance because 100% of the premiums that you pay go toward paying for insurance and nothing else.
You can buy term life in different increments such as a 10 year term, 20 year term, etc.. If you're considering purchasing life insurance for yourself and or your family, I highly recommend that you take a good look at term as an option.
About the Author:
Joe Stewart Is A Webmaster And Former Life And Health Insurance Agent. He's Made Understanding Life Insurance Easy For Others. You Can Get Free Life Insurance Quotes At His Website TheLifeInsuranceGuys.com or by clicking on Types Of Term Life Insurance
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