What is Term Life Insurance

Term life insurance pays a death benefit if the person insured dies within a specific period of time or before you reach a certain age.

The length of your coverage can be either for:

  • a fixed period of time, such as a term of 10 or 20 years

  • until you reach a set age, such as 65 years old

If you die within the duration of the policy, your beneficiaries will be paid the death benefit. Once the term ends, the coverage ends and your beneficiaries don’t receive any payment.

Term insurance policies don’t include cash value. This means you can’t borrow against your policy and you won’t get any cash value back if you cancel your policy. Some term policies can be renewed.

Generally, your insurance company will establish your premiums, or the fees you pay, for the length of the term. Your premiums may increase when you renew the policy. For example, premiums would increase every ten years on a ten-year renewable policy.

If you don’t pay your premiums, your insurance company may cancel your policy.

Term life insurance premiums are generally less expensive than permanent life insurance premiums when you first buy the policy.

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What Is Life Insurance?

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What is Permanent Whole Life Insurance