Is one of your goals for 2024 to get life insurance? There’s no time like the present to start. After all, life insurance can provide your loved ones with valuable financial assistance if you ever pass away and can no longer be there to provide for them.
One of the most convenient and easily managed types of life insurance is a term life policy. However, this coverage doesn’t last forever, and it’s imperative that you maximize your policy to your advantage while you do have it.
If you aren’t sure about the finer points of term life insurance, then just keep reading. There are a lot of different ways that a term life plan can benefit you as long as you use it correctly.
1. What is term life insurance?
Term life insurance is like all other life insurance. It allows you to assign a value to your own life, which the insurer will pay out if you die. However, the thing about term life policies is that they will only be active for a set number of years—a term. You must die before the policy expires for it to pay out.
2. How long do terms last?
You generally have leeway to choose a life insurance term that works for you. However, insurers do place certain restrictions on this choice. For example, you might only be able to choose a term that lasts for 5, 10, 20 or 30 years.
3. What term is right for me?
One way to go about choosing a policy term is to think about how you want your life insurance to be used. For example, if you want to buy a policy that will help your spouse pay off your mortgage when you die, then you can choose a term that will end at the same the mortgage.
4. Who can be my beneficiary?
On your policy, you must name a beneficiary. This is the person who will receive your death benefit payout. Usually, you can name anyone a beneficiary, such as a spouse, close friend, adult child, estate executor or even a charity. However, you cannot name minors as beneficiaries.
5. Can I control where my death benefit goes?
After your death benefit pays your beneficiary, they generally have free leeway to use the money as they choose, and you won’t be alive to control the money anymore. However, if you want to set rules on the use of the money, you can establish a trust, which will set rules on the use of the money that beneficiaries must follow.
Throughout the application process, our life insurance agents are committed to helping every client get the term life policy that will always provide them with optimized benefits. We’re here to make sure that your process for getting this critical coverage is an easy, affordable and convenient one.