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10 Year Term Life Insurance
Life insurance is a "must" for most individuals today. Term life insurance is most commonly used to provide loved ones with cash benefits in the event of your death, but it can be difficult to determine how much insurance you need to buy as well as what term length is right for you. A 10 year term life insurance policy is the most affordable term length you can buy, so you may be starting your shopping efforts by reviewing the benefits and features of this type of level term life insurance.
What a 10 Year Term Policy Is
A term life insurance policy is generally available to you in 10, 20 or 30 year terms. The longer the term length, the more expensive your insurance premium will generally be. The length of the term dictates how long you will enjoy death benefits from your coverage. With a 10 year term, you will enjoy coverage for a full 120 month period. If you pass away during this period of time, the person or people who you have named as beneficiaries on this policy may receive death benefits. Most policies do have exceptions in place, but most deaths that occur as a result of accidents and natural health issues will be covered by your policy.
At the End of the Term
At the end of your 10 year term, most policies will simply expire. In most cases, if you wish to continue to enjoy the benefits of life insurance coverage, you will need to purchase a new policy. The new policy will be priced at current rates. Because rates do increase as you age, it is often cost-advantageous to purchase coverage with the longest term length you believe you will need. For example, if you know today you will need coverage for 20 years, it will usually be more affordable to purchase a 20 year term life insurance policy today than to purchase two consecutive 10 year term policies.
How It Is Most Commonly Used
A 10 year term policy is most commonly used to provide death benefits to a loved one. Other types of policies, such as a whole life insurance policy, may be used for death benefits, establishing a legacy and more, but a 10 year term policy often is purchased with a very specific purpose in mind. The amount of life insurance purchased and the term length purchased often are decided based on how much cash a family may require to live on after your death, how much cash will be needed to pay off debts so that a survivor could support the family and more. While it can be difficult to determine what your financial needs for life insurance may be 20 or 30 years from now, most people will be able to more accurately determine these needs within the next 10 year time period. With this in mind, it is most commonly used as a source of financial sustenance and to pay off specific debts that you currently have so that your family is free of financial obligations.
How Much Do You Need?
Determining how much coverage you need with your 10 year term life insurance policy can be difficult. Some people will purchase a policy with the intention of paying off all debts with the proceeds, and this may be done with the expectation that a surviving family member would be able to support a family through his or her own job. Other people will purchase a policy with the intention of the survivor buying an annuity with the proceeds, and the annuity can be used to supplement lost income from the deceased. Still others may purchase a life insurance policy with the expectation that the proceeds will be used to fund a child's college education or for some other specific purpose. Ultimately, life insurance benefits can be used for many different purposes. If this shorter term policy is being looked at for funeral expenses you may want to explore a burial insurance option instead. These are good if the proposed insured is not in good health. To determine how much you need, consider what the financial effects of your death may be on those you leave behind. Consider what steps will need to be taken to ensure they can maintain their current lifestyle, such as reducing debts, supplementing income and more. Once you have developed a plan, ensure that the beneficiary you have named in your policy is aware of your plan for the use of death benefits.
Factors That Affect Your Rates
Once you have decided how much life insurance you want to buy, you can consider shopping for rate quotes. There are several different factors that will affect your rates. For example, your age and gender are two of the most important factors that will be reviewed. However, you should be aware that most life insurance companies will conduct a health physical and medical history before binding coverage. You will be asked questions such as family history, past and current medical conditions you are treated for. Whether you have diabetes, cancer, high blood pressure, or are just being treated for depression, it is important to report all medical conditions to the insurance provider. Failure to due so can result in an unpaid voided claims. Your answers to the questionaire as well as the results of your health physical will ultimately determine the final rate you pay for coverage. With this in mind, it is best to buy the coverage you need now to lock in rates for your current age. However, if you do not qualify for the best rates because of your health status, you can consider taking steps to lose weight (if you are currently classified as overweight ), to eat healthier, to stop smoking and more. Once you have improved your health status, you can shop for lower rates. However, you do want to purchase coverage now to enjoy the benefits that coverage can provide.
A 10 year term life insurance policy is ideal for many people. Whether you want a 10 year term policy or you believe a longer term policy is more beneficial for your needs, consider shopping for quotes today.