Term Life Insurance
What is Term Life Insurance?
Term life insurance can be complicated, and we will be with you every step of the way in answering the age-old question of " What is term life insurance?" A term life policy covers the policyholder for a specific amount of time, which is known as the term. The term lengths vary according to what the individual chooses. Terms typically range from 10 to 30 years and increase in 5-year increments, providing level term insurance. Among the most popular life insurance products available, term life policies tend to be more affordable. They typically provide an amount of coverage for much less than permanent types of life insurance. Speak to an agent toady about a term life policy that's right for your situation, and get your personalized term life insurance quote.
How Does Term Life Insurance Work?
Depending on the type of policy, term life can offer fixed premiums for the entire term or life insurance on level terms. The death benefits can be fixed as well. Because it's an affordable life insurance product and the payments can stay the same, term life insurance policies are popular with young people just starting out, families and people who want protection for a specific period of time. For example, someone who wants to protect an income until retirement or while paying off a home mortgage. Before you get a life insurance quote or buy a life insurance policy, try our online life insurance calculator to see what options for coverage and term length is right for you.
Term life insurance doesn't accrue cash value like several other types of life insurance, but with many term policies, beneficiaries do receive the full face amount. For example, if a policy's face amount is $100,000, the beneficiary receives the full amount, pure and simple. Even better, the benefits paid on a term policy are tax free, according to current tax laws.
There are several types of term life policies available through AIG Direct, including level, renewable and convertible. Get your free, no obligation, term life insurance quote today.
What Does Term Mean?
As stated above, "term" in the context of Term Life Insurance means - a life insurnace policy that covers the policyholder for a specific amount of time, which is known as the term. One of the most popular types of term insurance, level term life insurance (or term level life insurance) available through AIG Direct, offers life insurance on level terms or a fixed premium payment for the duration of the term. It also has a fixed benefit amount and the terms range from 10 to 30 years, usually in 5 year increment, but are sometimes available in one year increments.
A longer term could mean a higher monthly premium, because the carrier typically averages the cost of insuring someone who is younger with the cost of insuring someone who is older (when premiums are more expensive). Because level term life insurance has a "set it and forget it" fixed payment, it can be easier for families to budget. Having a fixed benefit that pays the face amount also holds appeal as straightforward, "pure" insurance.
Renewable Term Life Insurance
A renewable term life insurance policy available through AIG Direct continues in force for a specified term or terms, usually in increments of one or five years. It can be renewed without the insured having to undergo a medical examination or provide other evidence of good health or insurability each year. The premium for a renewable term policy generally is based on the insured's current or attained age.
Convertbile Term Life Insurance (Converting Term to Permanent Life Insurance)
The option to convert term life insurance can be "a valuable benefit" for some. This option allows people to convert their term life policy into a permanent life insurance policy, without a medical exam or the need to prove insurability. As time goes on, policyholders may need more coverage, or they might decide a policy with a cash value makes more sense. Having the ability to convert the policy offers nice flexibility as needs or financial goals change. There are two things to be mindful of with this convertible option. First, when you convert to a permanent life insurance policy, the premium increases. Second, there is typically a window during which you can convert. The ability to convert does not run for the entire term, so it's wise to watch for the deadline.
|Term Life||Permanent Life|
|Provides coverage for a limited time period (term), as long as premiums are paid||Provides lifetime coverage, as long as premiums are paid|
|Provides a death benefit, but typically no cash value||Cash value accumulates over time and creates an asset which may be used during your lifetime|
|Initially, less expensive form of life insurance||Level premiums for the length of the policy.|
|May be renewable or convertible||May offer flexible premium payments|
What is Group Term Life Insurance?
Group term life insurance is a type of term life insurance where the insurance company, or insurance broker, issues the employer a "group" contract with coverage extended to it's employees. It is commonly a component of a comprehensive benefits package offered by employers. Learn more about Group Term Life Insurance.
How to Buy Term Life Insurance
If you want to buy life insurance, you can get started by requesting a life insurance quote. One of our nationally licensed agents will help you answer your questions and find the best term life insurance policy for you and your family. Additionally, check out our online term life insurance calculator to help figure out your life insurance needs. Our life insurance calculator includes economic forecasting which models income growth and growth of money you put in savings. Get informed on what you need, then you will have more information when it's time to get your life insurance quote and buy your life insurance policy.
Term Life Insurance Buying Tips
Many consumers are unsure about the different types of life insurance, what type is best for them, and how much coverage they will need. To help make the process a little easier, AIG Direct offers the following life insurance buying tips:
- Purchase enough life insurance to meet all your needs, especially future ones. Skimping on your life insurance coverage today can leave your spouse, children, and others without enough money to live after you are gone. Be sure to add in the costs of mortgages, education funds, and other expenses your loved ones will have to shoulder without you. Use a life insurance calculator to more accurately estimate your current and future life insurance needs.
- Tailor your life insurance coverage to your individual needs. Life insurance is not a one-size-fits-all deal and we all have different needs. For example, make sure your dependents are covered until they are adults or can otherwise provide for themselves and that your surviving spouse is covered until he or she reaches retirement. Be sure to research the different types of term life insurance available to see that the type of policy you select is a good fit for your individual situation.
- Buy coverage when you are young and healthy, when you will generally earn the lowest rates. Many people put off buying life insurance until they are into their 50s and 60s, only to find out they either cannot get coverage or must pay higher premiums due to health factors. Also, consider policies that require a medical exam to get the lowest rates.
- Tell the truth, the whole truth, and nothing but the truth on your policy application. It may be tempting to say you don't really smoke two packs a day or that you aren't 25 pounds overweight, thinking that you are going to save money on your policy. But if you lie on your life insurance application, chances are your beneficiaries will not receive the funds they deserve when you pass away because you were dishonest in obtaining the coverage. And who wants that?
Reviews from Customers who have Bought Term Life Insurance through AIG Direct
We think what our satisfied customers say about us in their life insurance reviews, says more than any advertising campaign ever could. A life insurance rating from customers is a great way to see what people really think about a company. The reviews you see below are from customers who purchased life insurance policies through AIG Direct.
After a customer buys life insurance from us we ask them for a review. We post all reviews unless their content is obscene, inflammatory or not factually accurate. We ask customers to rate our services and then produce an overall rating as shown below. We encourage you to read our life insurance reviews and see just how happy our customers are.
Hear from Our Customers Who PurchasedLife Insurance through AIG Direct
Contacting AIG for life insurance was a great decision! They were prompt, detailed and extremely helpful!
New Braunfels, Texas
Motivation: Protect Loved Ones Financially
January 13, 2019
My AIG Agent was well qualified and met my requirements. He kept me informed throughout the process.
Motivation: Protect Loved Ones Financially
January 13, 2019
Read more of what our customers have to say and see their Life Insurance Customer Satisfaction Scores.
The endorsements/testimonials presented should not be construed as a recommendation to purchase, or an indication of the value of any product or service. The testimonials are actual AIG Direct customers who are not affiliated with AIG Direct and were not provided compensation.