For Life Insurance Awareness Month 2015, this three-part blog series will provide basic information on the different types of life insurance and help you determine which kind is best for you. When choosing between the different types of life insurance, always make sure that you are purchasing enough for you, your family, and your future.
Choice #1: Term Life InsuranceIf you need coverage but have a limited budget, term life insurance might be a great life insurance choice for you. Here are some things you need to know about term life insurance.
- It's temporary. You can purchase it for ten-, twenty-, or thirty-year periods. Catholic Financial Life also offers a Term Life for Children plan (TLC).
- There's no cash accumulation. With term you are paying for coverage only and not building any cash value like a whole life insurance plan will do. You can think of term insurance as "renting vs. buying." When it expires, it's done. There's no coverage nor cash.
- It's affordable. A 30-year-old in good health could pay less than $25 per month for term insurance.
- The initial cost is very low. Some plans also allow you to convert your coverage to permanent insurance before your term ends later on down the road.
- Coverage can be renewed at the end of the term, but you will probably have to pay much higher rates and your premium could as much as quadruple due to an increased risk of health problems that comes with age. For this reason, it's important to take advantage of this temporary insurance plan sooner rather than later.
This post is meant to provide general information about life insurance and is not to be considered as a solicitation for life insurance. Not all Catholic Financial Life products and services are available in all states.
Coming up next week: #2. Whole Life Insurance