When exploring your options for life insurance, you will be faced with selecting permanent insurance or term insurance. Generally speaking, permanent life insurance, sometimes referred to as whole life, is coverage that remains in place as long as policy premiums are kept up to date. On the other hand, term insurance is temporary in nature, covering the life of the insured for a specific period of time or term.
What are the situations when a term life insurance policy may be the best solution?
When Purchasing a Home
Term insurance is a superb way to ensure your home will be paid off in the event of death. The insurance term generally should coincide with the length of the mortgage. If you have a 30 year mortgage for example, a 30-year term life insurance policy would provide protection while there is still a loan on the property. You can select a decreasing term option, that would provide coverage that decreases as the loan is paid down.
When Getting Married or Starting a Family
Getting married or starting a family increases responsibility dramatically, especially for the next 20 years. Since term insurance is more affordable than permanent insurance, it can frequently be purchased in larger amounts. This will cover the time until a child reaches adulthood, even potentially covering college expenses.
To Cover a New Car Loan
A new car or truck today can easily cost $30,000, $40,000 or more. Term insurance can be acquired that will cover the balance for the duration of that car loan. You may be surprised at how affordable $30,000 worth of term life insurance can be for a period of five or six years.
When Starting or Investing in a Business
Term life insurance is a perfect choice to protect your investment when starting or buying a business. The proceeds can help keep the business going or at least cover any debts the company may have. Life insurance plays a critical role in many business situations to protect ownership interests and term insurance is an affordable option.
To learn more about your life insurance options and how term insurance in particular may be your best choice, contact one of our independent agents. They have access to a wide array of companies to find the best fit for you. Contact us today to get your no-cost, no-obligation life insurance quote today.