Term Life Insurance 101

When looking at life insurance policies, you are generally presented with two primary options: whole life and term life. The team at Kramer Agency, serving Bismarck, ND, wants to help you learn more about term life insurance, so you make an informed decision about your life insurance choice.

What Is Term Life Insurance?

Term life insurance is a type of insurance policy that is active for a set period of time, which is usually somewhere between five and 30 years. During that period of time, you can enjoy set insurance premiums. In addition, you will remain covered, assuming your monthly premiums are made on time.

How Does Term Life Insurance Work?

The conditions of your term life insurance policy are relatively straightforward. During the time of your activity policy, you and your beneficiaries are covered. In the event that you pass away during this time, your beneficiaries will collect the death benefits as outlined in your policy.

In the event that your term life insurance policy expires, you will have the option to renew the life insurance policy. However, keep in mind that your premiums will not remain the same. At this time, you always have the option to convert your policy to a different type, such as whole life insurance, as well.

What Are the Benefits?

One of the main benefits of term life insurance is that it is less expensive than whole life policies. Sometimes, you can even find policies that don’t require a medical examination. The death benefit can be used for virtually anything, such as funeral expenses, college tuition, or day-to-day living expenses.

Term life insurance policies tend to be flexible as well. Since you are not locked into long-term agreements with term life policies, you can reassess your situation every so often and make the necessary adjustments based on your circumstances. Some people choose to cover themselves only until their children are adults.

If you’re interested in learning more or investing in a term life insurance policy, contact the insurance agents at Kramer Agency, serving Bismarck, ND.