Term Life Insurance

The least expensive and simplest type of life insurance policy is Term Life Insurance. This policy has no cash value, and its only function is to pay a specific lump sum to the designated beneficiary upon the death of the insured person. The death benefit and the policy limit are the same. As an example, a $200,000 policy will pay a $200,000 death benefit. This policy protects your family by providing you the money you need to replace your salary, income, or other contributions. It also covers the final expenses incurred at death.

The premium must be paid, as agreed in the contract, and if you stop paying the policy will lapse. You won't owe anything to the insurance company, and they won't owe you a refund for any premiums paid if it lapses before the term ends.

At the end of the term, if the insured person is still living, you do not get your money back, and the policy is over unless you renew it. If the policy has that feature and you renew, it will renew at a higher price because of the current age of the insured person. Term insurance does not build up a cash value like other types of insurance plans, although there are some policies that offer a return of your premium. Make sure you're understanding the policy you're buying. Contact Affordable American Insurance to schedule an appointment to talk about your life insurance needs.

Term Life Insurance is ideal for those who don't require life insurance for an indefinite period of time. It will provide for people who depend on you, but the policy generally ends by the time children have grown to be independent, often when the policy owner retires.

Other life insurance types provide both a death benefit and a cash value. These premiums are higher because they fund the cash value amount along with providing insurance. These life insurance policies are frequently referred to as cash value policies.