Term life insurance is preferred and the primary option of many people since it is the simplest type of life insurance. It works by estimating the period of time that you would want to be insured and then calculate that into a dollar amount, which is known as the premium. To determine the amount of money needed to have benefits on the term of contract, they use the applicant’s current age and the age at the end of the policy’s term. Most of the time, it is based on one thousand dollars increments.

The premium for term life insurance is based on different factors that could put a person’s life at risk. This could be based on age, sex, lifestyle, and health condition. All insurance company checks and reviews every aspect of their applicant’s life to determine and conclude their mortality risk. It is vital and important for them to consider these things before they could come up with the premium price. Although they might not require you to undergo physical and mental examination, they would probably ask you about your medical history.

Good thing about term life insurance is you may have beneficiaries who will be entitled to get all the benefits that were included in your term if you pass away. To give an example on that, say you have a 5-year policy for $50,000, but you died on the second year of the term, your beneficiaries will get the full amount of $50,000 even if you were not able to finish the term. But of course, failed to make payments might lead to exclusion or exemption from receiving the benefits. The applicant may also renew his term after the specified years or may just let the policy to be terminated. When the term reaches the expiration date, the coverage of the term would also be automatically terminated. If you have decided to renew your term, say after 5 years, there will be a possibility that the premium price will also increase because you are getting older, and as I have mentioned earlier, your age will be used in determining your premium price.

Term life insurance works best and effective for militaries and soldiers, as well as travelers. They can choose a specific range of dates to be insured. With this type of insurance, they can save money because they don’t have to pay for the entire year of coverage and protection policies.

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