While comparing the rate quotes from different term life insurance companies can help consumers find the best prices for the life insurance coverage they need, consumers should also compare the different options and types of policies available with term life insurance. These options can be used to customize term life insurance policies so that they better meet the needs of different individuals and families.
How Term Life Insurance Works
An individual with financial obligations would be unable to save enough money to take care of their family if he or she died prematurely. Insurance takes a little money from a lot of people and pools the money so if one individual in the group dies, the combined money is paid to his or her family.
In this way, many individuals are able to provide for their families in the event of their premature death. The risk that any particular member of the group will die is spread among all the members of the group.
Level term life insurance coverage is the least expensive type of life insurance available. It features a fixed premium and a fixed death benefit over the policy term. At the end of the term the policy expires and the insured person must reapply for life insurance and undergo another medical exam.
A renewal clause in the policy allows the policyholder to renew it without having to reapply for life insurance. A term life insurance comparison will help consumers decide if this option is worth the additional cost.
Adjustable Term Life
During the course of a lifetime, or sometimes even a few years, circumstances and life insurance needs change. Adjustable term life insurance allows policyholders to alter the death benefit and premiums of their term life policy to meet their changing financial needs.
With adjustable term life, the policyholder can be certain they have enough coverage and that they are not paying for more coverage than they need. While these policies have higher rates than level term policies, their flexibility is practical for many consumers.
Convertible Term Life Insurance
Individuals who are just beginning their working lives may want the advantages of whole life insurance but cannot afford the higher premiums. A convertible term life insurance policy provides life insurance protection with the option to switch to a whole life policy when budgets permit.
Some convertible policies allow the change to be made any time during the policy term while others may have restrictions. These policies will show rates slightly higher than level term life in a term life insurance comparison.
Return of Premium (ROP) Life Insurance
Although the rates of this type of policy are higher than other types of term life insurance, if the insured outlives the policy term it is basically free. That is because this coverage returns all the premiums paid into the policy with interest at the end of the term.
This is not the same as the cash value of whole life insurance since the policy has no monetary value until it expires. An ROP policy can be used in financial planning much like whole or universal life insurance.
Life Insurance Quotes
There are multiple websites online, which offer free and instant term life insurance quotes online so consumers can compare the rates of different companies and the cost of different policy options. The cheapest term life insurance is not always the best coverage for a consumer, so it is important to look at more than cost when doing a term life insurance comparison.
It only takes a few minutes to complete a short form with basic rating information and quotes from multiple insurance companies are available immediately.
A good term life insurance comparison considers the advantages of options versus the price, the reputation of the companies offering the quotes and the rates charged by the companies.