What is Term Life Insurance? Do California Insurance Companies Offer This Policy?
Term life insurance
provides protection for a specified period of time. If your death is within
the covered term, the death benefit will be paid to your beneficiary.
No benefits are paid if you are still alive at the end of the covered
term. Term life insurance from qualified California insurance companies does not build cash value. For this reason,
term life insurance is one of the simplest and cheapest types of life insurance policies
available. Our California insurance agents are on standby waiting for your request for a free quote! Don't delay-- let our California insurance professionals help you with term life insurance!
Why would you purchase
a term life insurance policy when permanent life insurance policies gain
cash value? Term life insurance provides protection when you need
it the most! For example, when you get older, you may have fewer financial
responsibilities and the type of life insurance you need will change. You can address more specific questions to the licensed California insurance professional who contacts you when you apply for a free quote.
People who are concerned
about the price of California insurance coverage can often find a term policy that
fits their budgets. In addition, they may be able to buy a much larger
amount of coverage with a term policy than with a permanent policy. For
this reason, some people with permanent life insurance policies also buy
supplemental term coverage for the additional amount of protection. Talk to the California insurance agent who contacts you for more information.
The period of protection of a term life policy may be 1, 5, 10,
15, 20, or 30 years. This will provide you coverage for a child's
raising, child's education, mortgage, nursing home for your parents, and more.
Depending on the type of term policy you buy, your premiums
remain at the same level for a set period of time or for the full length
of your coverage. You may change your policy on an annual basis.
If you die during your coverage period, your family will receive a death
benefit equal to the amount stated in your policy when you purchased it (only if you do not change your policy).
If you change your policy, then
you and your California insurance agent/company will specify the benefit.
Your family can use the money they receive for any purpose. They can use
the funds for things like funeral expenses, medical bills, a college education
for your children, or simply to maintain their current lifestyle.
More benefits of term life insurance include extra features called
riders (for an additional cost). You may be able to add riders to provide
life insurance coverage for your spouse and/or children. Other riders
pay your insurance premiums if you become disabled, or allow you to receive
part of your policys death benefit early if you become terminally
ill. For more
information on disability insurance, click here!
When your policys term ends, your coverage doesnt
have to. With most policies, you can renew your policy for an additional
term without having to re-qualify for the coverage. You may choose to convert
your term policy to a permanent policy. If you choose to renew or convert,
your premiums will probably rise and there may be added restrictions.
Ask your California insurance agent for more details.
Term policies sometimes allow you to extend your coverage
for another term without having to get a medical check-up. For example,
you may simply renew the policy for another term, or you may be allowed
to convert your policy to a permanent policy. With both renewals and conversions,
you can expect an increase in premiums. Also, once you reach a certain
age, say 65 or 70, you might run into more limitations on renewals or
conversions. Term policies are useful in a lot of different situations.
Note: Beneficiaries usually dont have to pay income tax on death
benefits. However, they may owe estate taxes, depending on the size of
Term life insurance
policies are great for:
- someone who is
currently unable to pay the premiums of a permanent policy.
- home mortgage protection.
- other loan protection.
- additional protection
beyond another life insurance policies.
- other debt coverage, such as
credit cards, car loans, etc.
If you still
have questions about term life insurance, or want to know how you can purchase
a term policy, talk
to one of our licensed California insurance agents for more information.