Term Life Insurance Frequently Asked Questions

What is term life insurance? Term insurance provides protection for a specific period of time. It pays a benefit only if you die during the term. Some term insurance policies can be renewed when you reach the end of the term -- which can be from one to 30 years. The premium rates increase at each renewal date. Many policies require that you present evidence of insurability at renewal to qualify for the lower rates.

What are the advantages of term life insurance? Initial premiums generally are lower than those for permanent insurance, allowing you to buy higher levels of coverage at a younger age when the need for protection often is greatest. It's good for covering needs that will disappear in time, such as mortgages or car loans.

What are the disadvantages of term life insurance? Premiums increase as you grow older. Coverage may terminate at the end of the term or become too expensive to continue. The policy generally doesn't offer cash value or paid-up insurance.