Term Insurance Rates: The Basic Life Insurance

2007-03-08 10:33:40

( Health )



PURELY LIFE INSURANCE

Term insurance rates are generally lower than all other types of life insurance policies. Term life insurance is what those in the industry call a ‘pure” insurance where the insured buys the policy purely for benefits in the event of death and nothing more.

Term insurance rates are low because of the straightforward nature of this insurance plan. You are buying a life insurance that provides coverage for a specific period of time. Unlike health insurance rates where there are many variables, there are no other features and optional benefits that can add to a term insurance premium’s costs.

When buying a term life insurance there are several considerations that determine your term insurance rates – face value, term of coverage, age and health condition of the insured.

THE THREE FACTORS

The face value refers to how much your beneficiaries will receive in the event of the policy’s maturity. Of course it stands to reason that a policy with higher face value will have higher term insurance rates as well.

Term of coverage refers to the length of time wherein the policy will remain valid and insured remains covered. This also determines how long the insured pays the premiums to keep the policy active.

The age and overall health condition of the insured is also a major consideration. This will be the basis of your life expectancy and the corresponding term insurance rates that you will be charged with. When an insured is relatively young and is in good physical shape, the term insurance rates are generally lower than that if you were older or with a health condition that shortens your life expectancy.

There are no standard term insurance rates that can be applied across the board. Each individual’s unique circumstances call for independent and customized evaluation to determine their corresponding term insurance rates.


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