Term Life Insurance

The years when your family depends on your income the most are often the years when the budget has the least room for another expense. Term life insurance is designed to provide protection during those years.

A term life insurance policy provides a death benefit for a specified period, commonly 10, 20, or 30 years. If you die while the policy is in force, your beneficiaries generally receive the death benefit. Because term insurance does not build cash value, it can provide a substantial amount of life insurance coverage at a lower initial premium than many permanent policies.

The right term length often depends on what you are trying to protect—the years remaining on a mortgage, the time until your children are financially independent, or the income your family would need to replace. Many term policies also include a conversion provision that allows you to convert some or all of the coverage to permanent insurance during a specified period, subject to the policy’s terms. That option can become especially important if your health changes.

If you have a young family, a mortgage, or a farm or business that depends on you, taking time to understand how much protection your family would need—and for how long—can be an important part of building your legacy.

Have Questions About This?