What is Term Life Insurance?
Term life insurance provides temporary coverage for a specific period (10, 20, or 30 years). If you pass away during the term, your beneficiaries receive a tax-free death benefit. It's the most affordable type of life insurance, making it ideal for young families, homeowners with mortgages, and anyone needing substantial coverage on a budget.
Most Affordable
Lowest premiums for maximum coverage - perfect for budget-conscious families
Pure Protection
No investment component - 100% of premiums go toward death benefit
Flexible Terms
Choose 10, 15, 20, 25, or 30-year terms to match your needs
How Term Life Insurance Works
Choose Your Term Length
Select coverage period (10-30 years) based on when dependents need financial protection - until kids graduate, mortgage is paid off, or retirement.
Select Coverage Amount
Determine death benefit amount ($100K-$5M+) based on income replacement needs, debts, and future expenses like college tuition.
Pay Fixed Premiums
Your premium stays the same for the entire term. Never increases due to age or health changes during the policy period.
Beneficiaries Receive Payout
If you die during the term, beneficiaries receive the full death benefit tax-free. If you outlive the term, coverage ends (no refund).
Why Choose Term Life Insurance?
✓ Advantages
- ✓Lowest Cost: Most affordable way to get substantial coverage
- ✓Simple & Straightforward: Easy to understand with no complex features
- ✓Flexible Terms: Match coverage to specific financial obligations
- ✓High Coverage Amounts: Get $500K-$1M+ for affordable premiums
- ✓Level Premiums: Rate locked in for entire term - never increases
- ✓Conversion Options: Many policies allow converting to permanent coverage later
⚠ Considerations
- ○Temporary Coverage: Expires at end of term with no cash value
- ○No Cash Value: Doesn't build savings or investment component
- ○Renewal Costs: Renewing after term expires is very expensive
- ○Age Limitations: Harder to get or renew as you age
- ○No Return: If you outlive the term, no premiums are refunded
Who Needs Term Life Insurance?
Young Families
Parents with young children need substantial coverage to replace lost income, pay for childcare, and fund education if the primary earner dies.
Homeowners with Mortgages
Cover your mortgage balance so family can keep the home. Match term length to mortgage payoff date (20 or 30 years).
Working Professionals
Replace years of lost income for dependents. Rule of thumb: 10-15x annual salary for adequate financial protection.
Those with Significant Debt
Cover student loans, auto loans, credit cards, and other debts so family isn't burdened with financial obligations.
Parents Saving for College
Ensure children's education is funded even if you're not there. Calculate 4 years of tuition, room, and board costs.
Budget-Conscious Buyers
Get maximum coverage for minimal cost. $500K coverage can cost as little as $20-40/month for healthy 30-year-olds.
How Much Coverage Do You Need?
Simple Formula: 10-15x Annual Income
A common rule of thumb is 10-15 times your annual income. This provides enough funds to replace your income for years while family adjusts financially.
Example Calculation:
Detailed DIME Method
For more precision, use the DIME method:
D - Debt & Final Expenses
Mortgage, auto loans, credit cards, funeral costs ($10K-$15K)
I - Income Replacement
Annual income x years family needs support (10-15 years typical)
M - Mortgage Balance
Remaining balance so family can keep the home
E - Education Costs
College costs for all children ($100K-$200K+ per child)
What Affects Your Term Life Premium?
🎂Age
Younger applicants pay significantly less. Rates increase 8-12% annually. Buy early to lock in low rates.
🏥Health Status
Excellent health gets best rates. Medical exam checks blood pressure, cholesterol, and existing conditions.
🚬Tobacco Use
Smokers pay 2-4x more than non-smokers. Includes cigarettes, cigars, vaping, and chewing tobacco.
⚖️Weight
BMI affects rates. Healthy weight range gets preferred rates, while obesity increases premiums.
💰Coverage Amount
Higher death benefits cost more, but cost per $1,000 decreases with larger policies.
⏱️Term Length
Longer terms cost more but provide protection further into the future when renewals are expensive.
Get Your Term Life Insurance Quote
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Frequently Asked Questions
What happens when my term ends?
Your coverage expires. You can let it lapse, renew at a much higher rate, or convert to permanent insurance (if available). Many people buy term to cover specific obligations that end (mortgage paid off, kids grown), so they don't need coverage after the term.
Can I convert my term policy to permanent insurance?
Many term policies include a conversion feature allowing you to convert to whole or universal life without a medical exam. This is valuable if your health declines and you want lifelong coverage. Check your policy for conversion deadlines (often before age 65-70).
Is term life insurance tax-free?
Yes. Death benefits are typically paid tax-free to beneficiaries. Your beneficiaries receive the full amount without federal income tax. However, estate taxes may apply if your estate exceeds federal/state exemptions.
Do I need a medical exam?
Usually, yes. Most term policies require a medical exam (blood test, urine sample, blood pressure) for best rates. "No-exam" policies exist but cost 20-40% more and have lower coverage limits. The exam is free and done at your home or office.
How long does it take to get approved?
With a medical exam: 4-6 weeks. Simplified issue (no exam): 1-2 weeks. Instant approval policies: Same day for healthy applicants. Timeline depends on medical records requests and underwriting complexity.