Term Life Insurance

Customizable Coverage
Customizable
Coverage
Flexible Term Lengths
Flexible
Term Lengths
Affordable Rates
Affordable
Rates

What is Term Life Insurance?

Term Life Insurance is a type of life insurance policy that 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. 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?" and help you find the right plan. Speak to an agent today 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 permanent life insurance products, 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.

Term Life Insurance vs. Permanent Life Insurance

Term Life Insurance Permanent Life Insurance
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 Does the 'Term' Mean in Term Life Insurance?

As stated above, "term" in the context of Term Life Insurance means - a life insurance 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 increments but are sometimes available in 1-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.

Examples of Term Life Insurance Rates

*Rates reflect policies in the Preferred Plus Rate Class issues by American General

$250,000 coverage at a Preferred Plus Rate
  10-year term 15-year term 20-year term
Male 40 $13.92 $14.96 $18.18
Female 40 $11.57 $13.42 $15.77
Male 50 $24.56 $35.27 $40.81
Female 50 $21.12 $26.58 $31.85
$500,000 coverage at a Preferred Plus Rate
  10-year term 15-year term 20-year term
Male 40 $18.98 $21.13 $29.92
Female 40 $16.82 $21.12 $25.65
Male 50 $42.75 $55.81 $73.53
Female 50 $35.09 $45.74 $57.00

Learn more about Term Life Insurance by browsing the resources below:

Renewable Term Life Insurance

A term life insurance policy that can continue in force for a specified term or terms, usually in increments of one or five years.

Convertible Term Life Insurance

An option that allows people to convert their term life policy into a permanent life insurance policy, without a medical exam or the need to prove insurability.

Group Term Life Insurance

A type of term life insurance where the insurance company issues the employer a "group" contract with coverage extended to its employees.

How to Buy Term Life Insurance

Learn how to obtain a life insurance with the help of our licensed life insurance agents at AIG Direct.

Hear from Our Customers Who Purchased Life Insurance through AIG Direct

5 Stars
5 Stars - Great Life Insurance Coverage
Best Experience purchasing Life Insurance!
Contacting AIG for life insurance was a great decision! They were prompt, detailed and extremely helpful!
jjnegrete
New Braunfels, Texas
Motivation: Protect Loved Ones Financially
January 13, 2019
5 Stars
5 Stars - Great Life Insurance Coverage
15 year Term Life
My AIG Agent was well qualified and met my requirements. He kept me informed throughout the process.
David
Swansboro, NC
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.

This material is general in nature, was developed for educational use only, and is not intended to provide financial, legal, fiduciary, accounting or tax advice, nor is it intended to make any recommendations. Applicable laws and regulations are complex and subject to change. Please consult with your financial professional regarding your situation. For legal, accounting or tax advice consult the appropriate professional.