Like all life insurance, term policies can help families and individuals increase their financial security. But before we dive into the strategies for using these policies, it's essential to understand what they are.
Term life insurance policies provide a payout to the listed beneficiaries if the policyholder passes away while the policy is in force.
A term policy is in force for the duration of the "term," so long as the premiums are paid. This term is decided at the time the policy is created. It's often done in increments of ten, as in a 10-, 20-, or 30-year term life policy. That means if the policy expires and the applicable duration or term has completed, there won't be a payout. So, while these policies are often less expensive than permanent life insurance, the policyholder may outlive the policy.
Term life insurance often has more competitive rates than permanent life insurance policies. Some of this is due to the impermanent nature of term policies. Yet, these policies are also usually cheaper because they often lack certain features, like cash value (some permanent policies can accrue value over time, some of which can be withdrawn during the policyholder's lifetime).
Monthly premiums for people in their 20s and 30s acquiring a 30-year policy are often under $100/month, with variance depending on the amount of the death benefit. The affordability of term policies is one reason they're among the more common policies used in group life insurance plans.
When the policy expires, it goes out of force and can no longer pay out the beneficiaries. However, there may be an option to renew the policy. Depending on the policy, your situation, and the insurer, you may be able to renew your term policy for another term. However, because you are now older, rates may go up during the renewal process.
Everyone's life insurance needs are different. There are some scenarios where a 30-year life insurance policy could be the right choice for you, such as if you have financial goals, plans, or obligations spanning roughly 30 years. To help with planning, consider using the Ethos web tool to calculate coverage.
Whether you're just beginning a career out of college or family planning with a spouse, young people making plans for the future can be an ideal demographic for considering a 30-year term policy. For many people in these situations, such a policy would cover them until their fifties or sixties.
Having a special needs child can involve planning and research that other parents may not need. One part of this is finding ways to ensure your child's financial stability well into the future. A 30-year term life insurance policy can help provide some of that financial security.
Taking out a life insurance policy to match the size and duration of your mortgage can help ensure that your home is secure for your family, even if you were to pass away before the mortgage was fully paid off. Indeed, debt is one of the more common items that life insurance can help with.
People with roughly 30 years left until retirement may want a lengthy term policy to offset the risk of income loss if they were to pass away. This approach can provide financial security to your family or dependents at a time when it's needed most.
Term life policies often have the best rates. The younger and healthier you are when you begin the policy, the better these rates are likely to be. It's common for term policies to have fixed rates, so starting young and taking out a 30-year level term life insurance policy can help lock in low rates for a long time. For this reason, 30-year life insurance rates are often some of the most competitive.
Term life policies with Ethos include simplified and fully underwritten term life policies for qualifying applicants. With a simplified policy, you'll have a less rigorous application process, allowing for greater access and a quicker application. Fully underwritten policies involve a lengthier, more robust application process but generally allow higher coverage limits. While neither type requires medical exams for most applicants, fully underwritten plans include some health questions to help determine premium levels.
If you're looking for life insurance online, consider a 30-year term life policy with Ethos and get a quote today.