Are You Really Buying Cheap Term Life Insurance?
You must have seen some promotions for term life insurance companies. They usually show a happy and smiling couple who just got a great deal on a new policy. The rates are usually very low. Are these real deals you can make for yourself, or should you look into this further? Consider a few questions that you should ask before you buy.
Can your policy be converted to permanent coverage in the future? It is hard to know what will happen in 10, 20, or year years. You may think that all you need is a twenty year term policy, for example, to make sure a home mortgage is covered. But keep in mind that policy will expire in 2 decades, and then you could be harder to cover because of an illness. You will certainly be more expensive to insure because you are older!
Some term policies have a handy option so you can convert them to permanent policies, like whole life, before the term expires without having to go through another medical exam or health questions. This option leaves your options open. You have left the door open so you can decide to buy permanent coverage before your term coverage expires.
Not all term policies will have this option either.
Is the price you see in TV, really a price you can qualify for? This is a very real question. Advertisers tend to use the very lowest quotes that they give to their most preferred clients. Those rates are reserved for select applicants who are in great health, have a good family health history, are employed in certain professions, have good credit, etc. Only a fraction of applicants ever qualify for rates like these.
These ads can be deceptive, and sometimes you may get quoted a higher figure by an agent. He or she is just being honest because he or she has your actual health history in hand. You cannot assume that the rates you see advertised for some perfect and fictional person on the TV will be the rates that you will have to pay.
Also ask if the premium rate is guaranteed for the whole term of the policy. We usually assume this is true, but sometimes policies are quoted with a 5 year guaranteed premium. If the policy lasts 30 years, you may end up paying much more in the end.
So be sure the rates you are quotes will still be the same in the future.
How long does the policy last? It should be obvious that the less time that the insurer takes a risk by covering you, the less they will charge. So, all other things being equal, a 5 year term policy will be cheaper than a 15 year term policy. You should base your own policy length on your own needs. But keep in mind that the price will go up, the longer you want to be covered.
So, can you find cheap term policies? There is no doubt that term policies are an affordable way to buy life insurance coverage. There are lots of affordable policies out there for most people! But just be aware of what you are comparing so you get a great value, and not just a low price.
Find manycheap term life deals today! Also look for term life for older people. This article, Are You Really Buying Cheap Term Life Insurance? is released under a creative commons attribution licence.