Level Term Life Insurance

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Natasha McLachlan is a writer who currently lives in Southern California. She is an alumna of California College of the Arts, where she obtained her B.A. in Writing and Literature. Her current work revolves around insurance guides and informational articles. She truly enjoys helping others learn more about everyday, practical matters through her work.

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Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance for 10 years. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate...

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Reviewed by Laura Walker
Former Licensed Agent

UPDATED: Sep 24, 2020

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Level term life insurance policies provide coverage with unchanged premiums and face value from the start of the policy until the expiration date. These policies have a level premium for the duration of the policy. These types of accounts offer very little flexibility offered regarding renewal of the policy. When the policy can be renewed it is not unusual for the premiums to rise sharply.

For those that bring home the majority of income for a family, it may be wise to have a level term insurance policy. These types of policy can ensure that the family can meet all of their financial obligations if this person passes away. There are a variety of durations and premium schedules available for level term policies, ranging from 1 year to 30 years. The payouts for these policies can make sure that the house is paid for and that the kids have enough money to go to college.

There is a determined expiration date for term life policies. After the policy expires, they can be renewed, which results in higher premium payments. Or the policy can be converted to a whole life policy. Be sure to know your reasoning for getting a term life policy. Term policies can be allowed to expire altogether at the end of the term, if you no longer need to have the financial coverage for meeting financial obligations. If you are going to let the policy expire, it is possible that you didn’t choose the right account for your needs in the first place.

Most of the time, a level term policies are much more affordable for the coverage you get than other term policies. They do, however, have higher premiums than many other types. Even though they do
have slightly higher premiums, they end up being more affordable for the life of the policy than policies that are reviewed on a regular basis. This is not always true, but the exceptions are so minimal as to not warrant any further discussion.

If you think that a term policy will cover your requirements better than a whole life policy and that you will not need to renew when the policy expires, then term life coverage may be the best choice to get the coverage you need at a price you can afford.

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