From the course: Risk Management and Insurance Planning: Designing for Client Needs
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Term life insurance
From the course: Risk Management and Insurance Planning: Designing for Client Needs
Term life insurance
Let's start with a visual. Focus just on the first row, under Types of Life Insurance. There are two types of life insurance policies, term insurance and permanent life insurance. Both require the insured person to pay premiums at regular intervals over the policy, and each provides a cash payout on the death of the insured if and when it happens, but there There are important differences in the mechanics of the two products. Let's learn them by comparing and contrasting the two. Term insurance is called term insurance because you pick the term. You can be covered for a set amount of time that's entirely up to you, whether it's 10, 15, 20, or 30 years, all the way up to the day the insured turns 100 years old. Depending on your situation and outlook, you'll decide whether your term insurance contract is non-renewable, renewable, or convertible. Non-renewable term insurance, after the coverage term ends, the policy expires. If you want to continue being insured, a new contract needs to…
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