There are a lot of factors in life that we have to pay close attention to, especially when it comes to the world of insurance.
Now, most insurance products deal with the lines of protecting yourself against the unforeseeable.
People invest in life insurance as a way of protecting their loved ones. Because the future is unpredictable and you never know when the inevitable happens.
One form of insurance that stands out is term life insurance.
Essentially, term life insurance is one kind of life policy that can provide that kind of financial protection.
But what is term life insurance? Well, it is a type of life insurance policy that has a specified end date. For example, 15 years from the start date.
The death benefit will only be paid out if the policyholder dies during the chosen term. Hence why it's called a term life insurance policy. The death benefit is the amount of money that will be paid to the beneficiary when the policyholder passes away.
Take a look at those benefits below.
A More Flexible Insurance Option
One advantage that stands out about term life insurance deals with how flexible it can be. You will have several options when deciding how long your term should last.
It could be 10 years or it can be 30, but it doesn't stop there.
Most policies could help cover any short-term debts or expenses. This applies if your policy lasts for a least five years.
Being that this form of insurance is so flexible, you can work with a policy that fits you best.
In some cases, the need for certain policies may disappear throughout your term's time.
Not As Expensive As Other Policies
People always want to go with the best option, but one that is affordable as well. Now, life insurance rates are more affordable for term than whole life insurance.
This is because term life insurance options offer policies that cover a predetermined amount of time.
Whole life insurance handles its policies differently in comparison to term insurance. For instance, whole life insurance premiums are much higher simply because those policies pay out no matter when you pass.
Term life insurance is less of a risk to the insurer. But why?
Simple, if you outlive the set term and the policy expires, then your beneficiaries won't receive the death benefit.
Term polices are not only beneficial, but they are much more affordable for you.
Proceeds Will Be Paid To The Beneficiary Without Delay
Now, life insurance proceeds are not a part of the probate estate. But this is only if the estate isn't named as the policy's beneficiary.
So what does this mean for the beneficiary?
Most delays are often caused by the administration of the estate, but not in this case. Instead, the proceeds can be paid to the beneficiary without any form of delay.