What is Universal Term Life Insurance?

What is Universal Term Life Insurance?

Universal term is a type of flexible term insurance contract. Similar to, and actually a variation of, universal life insurance, it allows the policyholder to set up a customized pattern of premiums and face amounts. The insurer also may allow changes after issue, within limits. Reproduced with permission.  Copyright The National Underwriter Co. Division of ALM

Read More

Do Term Life Policies Forgive Premiums if the Insured Becomes Disabled?

Do Term Life Policies Forgive Premiums if the Insured Becomes Disabled?

The waiver of premium rider, which is a common rider to most permanent or ordinary whole life policies, provides that premiums are waived if the insured becomes totally and permanently disabled. This rider is available on many renewable-term policies. Company practice is not uniform with respect to the inclusion of the waiver of premium rider in a new policy obtained by converting a term policy that includes a waiver of premium rider. Some companies do…

Read More

Types of Term Life Policies

Types of Term Life Policies

Renewable Term Policy Term policies are either renewable or nonrenewable. This means, for a small additional premium, the policyowner has the contractual right to continue or renew the contract at the end of the term. If a policy is renewable, the policyholder may unconditionally renew the coverage for successive terms at higher premiums (appropriate for the given renewal age) merely by paying the indicated premium. Insureds do not have to sign forms or provide evidence…

Read More

How to Compare Term Life Policies

How to Compare Term Life Policies

One must check all of the policy provisions to see if the policies provide identical benefits. In most cases, the policies available from different companies will not be identical. Therefore, the one needs to weigh the slight differences in the policy provisions against the differences in the premiums. Here are some factors to consider: In the case of renewable term policies, check the schedule of future renewal premiums. A policy with the lowest initial premiums…

Read More

5 Disadvantages of Term Life Insurance

5 Disadvantages of Term Life Insurance

Understanding the disadvantages of term life insurance helps consumers make the most educated decision. Here are the 5 major disadvantages that should be considered when considering term life: Term insurance has no tax-free, automatic savings feature as permanent coverage does. The premiums increase until payment becomes prohibitive at later ages. This is one of the main reasons for the purchase of whole life insurance because coverage is useless if it cannot be held until the…

Read More

10 Key Advantages of Term Life Insurance

10 Key Advantages of Term Life Insurance

Understanding the advantages of term life insurance helps consumers make the most educated decision. Here are the 10 major advantages that should be considered when considering term life: Term insurance allows a person to acquire the greatest death benefit for the lowest premium outlay when the policy is first issued. However, this does not mean that term insurance is necessarily the least expensive form of insurance over the full duration of needed coverage. Because term…

Read More

8 Circumstances that Call for the Purchase of Term Life Insurance

8 Circumstances that Call for the Purchase of Term Life Insurance

Generally, term insurance is not the most effective type of life insurance for all of these death benefit needs. However, term insurance may serve the insured’s needs in many circumstances. Because term insurance is not just one product, but rather many variations on a general theme different types of term insurance are indicated for different types of needs. Keep in mind, term insurance, more than any other type of insurance, is pure death protection with…

Read More

12 Reasons for Buying Life Insurance

12 Reasons for Buying Life Insurance

In general, some type of life insurance is indicated when a person needs or wants to provide an immediate estate upon his or her death. This need or desire typically stems from one or more of the following reasons: Providing income for dependent family members until they become self-supporting after the head of household dies. Liquidating consumer or business debts, or to create a fund, enabling the surviving family members to do the same when…

Read More

2 Primary Characteristics of Term Life Insurance

2 Primary Characteristics of Term Life Insurance

The two principal characteristics of term insurance are: (1) the insured must die for any benefits to be paid; and (2) by definition, the contract expires at the end of the term. Stated more specifically, a term life insurance policy promises to pay a death benefit to a beneficiary only if the insured dies during a specified term. The contract makes no promise to pay anything if the insured lives beyond the specified term. Generally,…

Read More