Also known as level term life insurance, level term insurance is a type of live coverage that carries the same face value for a specified duration or term. While the length of that term can vary anywhere from a single year to as many as 30 years, many plans of this type carry a duration of somewhere between 10 and 20 years. During that period, the face value is guaranteed as long as the premiums are paid on time. As with most types of term insurance, the plan does not pay out the face value to beneficiaries if the covered party does not die during the term, and the plan will not accrue any type of cash value. Choosing the right level term insurance for your needs involves assessing your life expectancy, evaluating the amount of coverage you want, and also considering the amount of the monthly premium.
Since level term insurance only provide coverage for a fixed number of years, it is important to consider your life expectancy when taking out this type of plan. Younger adults will normally want to go with the longest duration or term possible, providing them with protection during the years in which they are raising families. Adults who are reaching retirement age and for some reason are not able to afford the higher premiums that come with whole life insurance plans will also want to project the maximum number of years they can reasonably be anticipated to live, given their current age and health status. Doing so will increase the chances of the level term insurance being in effect at the time of death, making it possible to leave behind funds that loved ones can use to settle final expenses or provide some degree of financial security once you pass away.
Another important consideration with level term insurance is the total face value of the policy. Take some time to determine how much money your beneficiaries would need to aid in settling your end of life expenses or have some money to help replace the household income lost when you died, at least for a reasonable period of time. Even if you don’t owe a lot of money, take into consideration that there could be medical and other expenses that loved ones will need to settle, as well as managing to keep the household going until a surviving spouse or significant other can make arrangements to secure work and replace the lost income.
As with many types of expenses, it is important to balance the need to secure a certain amount of coverage with what you can afford in the way of monthly insurance premiums. One benefit of level term insurance is that the rates are normally very affordable, meaning that even if the budget is tight, there is a good chance you can afford at least some coverage. After determining how much coverage would be best for your situation, compare level term insurance plans offered by several providers. In a short period of time, you can find a reputable insurance provider who has term rates that fit your needs and allow you the peace of mind that comes from knowing your loved ones will be provided for adequately.