There are many forms of life insurance coverage available, and each policy helps protect the people you care most about if something happens to you. But to truly benefit from the right plan that fits your needs and budget, you need to understand every aspect of the coverage. Let’s take a closer look at term life insurance dos and don’ts.
Term life insurance is a form of life insurance coverage that provides temporary financial security. With a term life insurance policy, you select a coverage amount and a specific period of coverage, usually 10, 20, or 30 years.
For the entire duration of the selected term, your beneficiaries will receive your plan’s benefit if something happens to you. Your beneficiaries can use the benefit amount in any way they choose, including:
Each term policy can differ depending on the insurance provider you go with, so it is best to get as much information as possible from insurance companies before deciding on a plan.
To make the most informed decision possible when looking for the right term life insurance plan, you need to know the ins and outs of the coverage. Below we’ve created a helpful list of the steps you should be taking when purchasing and applying for coverage, as well as the things to avoid.
Before you take any other steps, you need to know the reason you are looking for coverage. Start by creating a financial needs list and use that as a reference when picking your life insurance policy. For example, are you the only breadwinner? Do you have children, or are you planning to have children? Are you buying a home?
These questions will help you reflect on your family’s financial situation and provide guidance on the type of term life insurance plan you need. We also have a helpful calculator tool that can help you identify the best amount of coverage for your unique needs.
It is essential to get plan options from a variety of insurers to see what is available to you in the market. Get information from different sources as well. Speak to life insurance agents, friends, and family members to better understand different plan options and experiences with term life insurance coverage.
Stay informed as much as possible by reading up on the life insurance market and the new developments of life insurance companies. You’ll always be aware of changes to existing plans and announcements for new coverage options by staying up to date.
When you are shopping around for coverage, always ask any questions you may have about a policy. You need to know every aspect of a plan before you decide to make a purchase. Ask a licensed advisor if there is something about the term life insurance coverage you aren’t sure of, especially if you don’t see anything about your concern in the plan brochure.
As you are applying for a plan, read every page of the policy given to you. You must know every aspect of your coverage to communicate it better to your beneficiaries. When the time comes to make a claim, you’re going to want to ensure your beneficiaries understand how your policy works so they can correctly make a claim and collect their benefit.
Many clauses in life insurance contracts and policies are glossed over or not appropriately communicated by insurers. So, you need to take matters into your own hands and go over your plan thoroughly.
After you buy your coverage, don’t fall into the common trap of forgetting about your policy. When you purchase a plan, sit down with your loved ones and ensure they are aware of it and where to find your policy should something happen to you.
This is perhaps one of the most important tips we can provide. Lying on your life insurance application can have severe consequences that will leave your loved ones without coverage when they need it most. Misrepresented information often leads many insurers to denying your family’s claim if something happens to you.
For example, if you lie about a specific piece of information like your age or if you are a smoker, when it comes time to make a claim, your insurer could find out and reject your policy and any premium refunds.
You have to make your monthly or yearly premium payments on time. If you consistently miss payments or refuse to pay, your coverage will be cancelled, leaving you without any financial security.
There are also late fees that could be added to your premiums if you are missing payments. Most insurers have grace periods for premium payments, but you need to check to ensure your insurer offers that benefit.
The key to buying term life insurance is to get it sooner rather than later. A term life policy gets significantly more expensive the longer you put off getting insured. It’s best to get insured as soon as possible so you can lock in a low rate for anywhere from 10 to 30 years.
We hope our term life insurance dos and don'ts provide you with more insight into this form of coverage. At termforme.com, we are specialists in term life insurance coverage. Our mission is to make term life insurance as accessible and affordable as possible for Americans. We offer three unique term life options:
Each of our plans offers up to $750,000 in coverage with guaranteed premiums and renewable term lengths.
Apply now for a free no-obligation quote to start discovering your term life insurance options. Our dedicated team members will ensure you are completely comfortable every step of the way and explain all aspects of your plan in detail.
Written by: Adam Bianco