Proper Planning Is The Only Precondition For Receiving Low Cost Term Life Insurance

Term life insurance is one of the most recommended forms of life insurance which affords you greater financial security at affordable prices. You need not worry about paying any hidden charges or looking for expert advice to manage the policy effectively. The beauty of the concept embodied in term life insurance lies in its simplicity in structure and ease of functionality. This offers a good amount of leverage to the user who can make better and informed decisions to fulfill his financial objectives successfully.

Many people do not like term life because:
• It is valid for a limited term whereas whole life insurance policies are valid for their entire lifespan. However, staying covered for thirty years is enough if we learn to manage our resources intelligently.
• Another point that the proponents of whole life insurance harp on is its cash value. The whole life builds up cash value, which you can take out by surrendering the policy after a stipulated period. Moreover, accretion of cash value allows you to take loans against such a policy. Term life does not have any cash value. If you do not die within the term, you do not get any return on the money you paid as the premiums.

One more point that apparently goes against term life is that, it does provide any investment opportunity, while the whole life policies accrue a cash value within, which can be taken out by surrendering the policy after stipulated years. However, on closer examination you will find that the cash value is built from the excess amount you pay as premiums. You can easily buy the low cost term life insurance for insurance purpose and invest the difference in some other investment schemes. That will be more profitable.

Therefore, we can see that whole life insurance policies are not only dearer, but one does not gain much by purchasing one. On the contrary, we often have to reduce the coverage amount to keep it under affordable level and this defeats the whole purpose of buying a life insurance policy. It is much better to spend some time calculating the coverage period and then to buy low cost term life insurance for as many years as necessary.

Life expectancy depends on your age and health condition but a number of other factors are also used in making a reliable estimate of the same. These factors include your lifestyle and habits which are taken into account to make sure there is nothing which affects your life expectancy adversely. For instance, if one should be a smoker, it can affect life expectancy and hence it can make difficult to get low cost term life insurance. The insurance rates are increased proportionately to part compensate for the risk taken by insurance company by insuring a smoker.

Tobacco use is a big issue with the insurers because it can cause many terminal diseases. It is not that you will be refused coverage if you smoke, but you will definitely be denied low cost term life insurance. Generally, the rates are 2.5 times higher for the smokers than for the nonsmokers. However, do not try to hide the fact that you smoke because you will be caught during the medical test. Moreover, if you grow any smoking related disease and die from it, your beneficiary may be denied benefit. It is much better to look for those carriers who treat smokers more sympathetically and charge at a relatively low rate.

If someone is in an occupation which exposes him to a higher level of risk than an average office-goer, it could affect the life expectancy in some measure. The insurance rates would also climb up proportionately to account for the risk factor involved. It is always useful to buy early in life if one wants to get low cost term life insurance to meet his individual insurance needs well enough. However, health condition is also an important issue and in certain cases even young people with health complications might end up with an expensive life insurance policy.

Buy the policy for as many years as you need. The coverage amount too should be adequate for your family’s need. You should decide on these two factors before you buy the policy. Since term life insurance cost is quite affordable, both the policy duration and the policy amount should be little more than required. It will make your family financially secure in case of your unfortunate and premature demise.

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