Term life insurance is a type of life insurance that provides coverage for a specific period, or "term," usually ranging from 10 to 30 years. If the insured person passes away during the term, the policy pays out a death benefit to the beneficiaries.
Unlike whole life insurance, which provides lifelong coverage and includes a cash value component, term life insurance only provides coverage for a set period and does not build cash value. Term life is generally more affordable and straightforward.
When the term ends, the coverage expires. Some policies offer the option to renew the term at a higher premium, convert to a whole life policy, or you can let the coverage lapse if no longer needed.
Term life insurance is ideal for individuals who need coverage for a specific period, such as until their mortgage is paid off, their children are grown, or they reach retirement. It’s also a good option for those seeking affordable life insurance.
The main advantages of term life insurance are its affordability and simplicity. It provides high coverage amounts for low premiums and is straightforward, making it a popular choice for those seeking temporary financial protection for their loved ones.
Yes, you can cancel your term life insurance policy at any time. However, if you cancel the policy, you will no longer have coverage, and there is typically no refund of premiums paid unless you cancel within the initial "free look" period.
