What is covered with term life insurance? Although a medical exam can be part of the initial application process, you usually won’t need another one to convert or renew the policy. Additionally, the insurer may offer a conversion option for switching to a permanent policy, usually within a specific time frame. This temporary life insurance option is often renewable at the end of the term, though your premiums typically rise.

Plus, unlike with permanent life insurance, there is no cash value to utilize during your lifetime. If you outlive the policy, your beneficiaries won’t receive any of the death benefit, and you would only get some of your premiums back if you have a return of premium rider. If you keep up with your premiums and pass away during the term, your beneficiaries will receive the payout, which usually isn’t taxed. However, there are also decreasing and increasing term policies that lower or raise the benefit amount over time, as well as annual renewable term policies that provide coverage for one year at a time. Most often, you’ll have a level term policy with a benefit amount and premium payments that don’t change during the term. Term life insurance is a policy that pays a death benefit to your chosen beneficiaries if you pass away during the coverage period, which usually ranges from one to 30 years.

To have budget-friendly premiums: Term life coverage is usually a more economical choice than a comparable permanent life insurance policy since it lasts for a set number of years and doesn’t include a cash value component.

To enjoy flexible coverage: You can pick the term length, benefit amount and policy features based on your family’s needs.

To get funds for important goals: Your policy’s death benefit can go toward goals such as paying off the mortgage, leaving an inheritance or covering your children’s college.

To cover your final expenses: The coverage can help your loved ones pay for your funeral service, burial or cremation estate-related expenses and medical debt.

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*Average annual rates for term life coverage were calculated based on quotes for nonsmoking 30- and 40-year-old females and males in excellent health living in California for the coverage amounts of $250,000, $500,000, $1 million and $2 million and term lengths of 10, 20 and 30 years.

Term life insurance quotes