Several decades ago, whole life insurance was much more popular than term insurance. People preferred a policy that would never expire and that they could withdraw money from, much like they could a savings account at a bank. However, as the cost of living rose, many individuals discovered that they could not afford the high premiums for whole life insurance policies sufficient enough to support their families. Hence, term life insurance is rising in popularity.
Many individuals choose term life insurance to fit temporary circumstances if they become unable to provide for their family. Many working men and women purchase bigger term life insurance policies while they have children at home but allow the insurance policies to expire after the children grow up. Others have term insurance when their children are in college to ensure that tuition will be paid should something unexpected happen.
Term life insurance is becoming more popular because it allows individuals to purchase a lot of coverage for a low monthly payment. In fact, the monthly premiums are still reasonably low even for individuals nearing middle age. Some people who have a limited monthly budget can afford to choose half a million to a million dollars of coverage to allow their family to continue living comfortably should something happen to them.
As the popularity of term life insurance is rising, new types of policies are being offered. Traditional term offers level payments for a specified period of time, usually 10, 20 or 30 years. However, some families are choosing a policy with return of premium. For a slightly higher premium each month, they will receive back all the money paid into it at the end of the term.
The cost of any type of life insurance depends directly on the age and health of the individual to be insured. Many will want to get a quote here for a term life insurance policy, while others will prefer to chat with an insurance agent to get answers to all their questions. Whatever the case, every person that cares for a family member or an elderly parent will probably want to have a secure life insurance policy with affordable payments.
Hi, my name is Jon and I run Compounding Pennies. I’ve been interested in personal finance since high school and love writing and talking about it. You can learn more about me in the Authors section of this site.