Term or Permanent Life Insurance Which is Right for You?

The insurance term life is the simplest of all as it should only worry about choosing the amount of coverage and the number of years you want to keep the policy, which can be from 1 year to 30 years. When the term expires, you will have the choice between renewing the policy, changing it or simply letting it expire and leave without that protection. It is ideal if you only need protection for a certain time, such as when your children are still young or while you are paying the mortgage on your house. So when that important period of protection for yours has passed, you can decide not to renew the insurance and save on paying premiums.

If what you are looking for is to continue obtaining protection, even if you already have assets of your own to provide constant economic protection to your family until the moment of your retirement or during your golden years, permanent life insurance is ideal for you, since it does not expire within a specified period of time, of course as long as the payments and the policy specifications are met.

It also offers you a very interesting savings function that will depend on the type of permanent insurance. You choose, the insurer and the conditions of the policy. These can be of the traditional permanent, variable, universal or universal-variable type.

 You choose the one that suits you best

The savings with the insurance works as follows: as the insurance is permanent, that is, it does not have to be renewed every so often (as with the term), the insurer obtains an average of the price of the policy (since the premiums could be very expensive when the insured is very old), to arrive at a premium amount that is actually above what the insurance costs when the person is young.

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Then that portion that is overcharge, must be invest in the name of the insure and must be available to him as a loan for when he needs it. It is worth clarifying that this savings is available only to the insured and not to their beneficiaries, since the latter can only have the amount of the insurance, once the insured dies.

On the other hand, term life insurance can be more expensive than you think, since many times you have the need to renew them. When they expire, and perhaps by that time, the payment of the premiums will be up to you. to increase or perhaps you have become ill or have other conditions that do not allow you to buy life insurance again or that the price rises beyond what you can pay for it.

Term life insurance can be for 1 year

In general, term life insurance can be for 1 year, renewable each year; 5 years, renewable;10,15,20 or 30 years; or up to a specific age, for example, up to 65 years, 70 years, etc. The most requested today is the 20-year-old. Term policies can also be level  and declining (due to their characteristics, the price could be lower than the level ones).

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While permanent policies do not expire for a long period of time. In which you will also maintain the same payment throughout that period, term policies may or may not be renewable. And the amount of the premium will increase each time it expires.

When they are renewable ?

When they are renewable, it means that when the term of the policy expires. The insured will not have to repeat the medical examination to qualify. Nor will they run the risk that by that time their health has deteriorated. They are no longer eligible for the same insurance as Had before; On the other hand, if you choose your non-renewable term policy. You will have to prove again that you are eligible to purchase that policy when it expires.

If you want to know more about term policies and permanent policies separately. You can read the articles for each of them. Take into account the specific needs of your family and add to the equation how much coverage you will need. Only then will you be able to exactly compare a life insurance for couples  and a permanent one. These comparisons made here are therefore generalities that we hope will help you make your own comparison. Make it easier for you to make the decision that best suits you.