Level Term Life Insurance: What it is, How to Buy | Guardian

start by thinking about how long you’ll need protection

If you’re getting income replacement life insurance to protect your family’s finances, you should consider a term long enough to see your children leave home and attend college. the longer your term, the more you’ll typically pay each month. however, you may want to err on the side of a longer term. this is why.

let’s say a 10 year policy is $600/year and a 20 year policy for the same amount is $900/year. you might be tempted to get the cheapest 10-year policy now, and then another 10-year policy if you need it later. But if you think your family needs protection for 20 years, how likely is it that in 10 years you will decide that protection is not needed? you may end up paying more if you get two policies in a row.

Reading: What does level term mean in life insurance

The older you are, the more you’ll typically pay for life insurance. in 10 years, you will be an older applicant who may have been diagnosed with a health problem, such as high blood pressure. Even if it’s under control, your premiums for a new policy could go up. This type of scenario is quite common, and over 20 years, you typically end up paying more by opting for two 10-year policies.

estimate the amount of your coverage

See also: Cheap SR-22 Insurance: Cheapest Companies by State in 2022

It’s always a good idea to talk to a financial professional who can not only help you estimate your need, but also guide you to the right coverage solution for your situation. but if you’re looking for a starting point, here are some rules of thumb to determine your need for coverage:

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