漏电保护器品牌公司 Term Life Insurance

A term life insurance policy is the simplest form of life insurance: You pay a premium for a period of time — typically between 10 and 30 years — and if you pass away during that time, a death benefit is paid to your beneficiary or beneficiaries.

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However, unlike permanent life insurance policies — whole and universal life insurance — term policies don’t build cash value and don’t cover you for life, just until the end of the term.

Here are three key questions you should consider before you get a policy:

How does term life insurance work?

What are the different types of term policies?

How much term life insurance coverage do you need?

How term life insurance works

It's a contract: A term life policy is an agreement between you and an insurance company. You agree to pay term life insurance premiums for a specific term (usually between 10 and 30 years). In return, the insurance company promises to pay a death benefit to your beneficiary if you die during the term.

There's an application process: Before they issue you a policy, the insurer needs to assess how much of a risk you are to insure. They'll typically require a medical exam and ask about your occupation and lifestyle. The cost of term life insurance will vary based on these factors. For example, dangerous occupations may raise rates.

Choose a term length: How long will you need term life insurance coverage? If you he children –– especially a young family — a popular rule of thumb is to choose a term long enough to see them out of the house and through college.

Choose a death benefit: If possible, you should choose a death benefit that will cover most or all your family's needs in your absence. However, whatever coverage amount you choose will likely cost less than you thought. In fact, one survey found that 72% of people overestimate the actual cost of a basic term life insurance policy.1

Name your beneficiaries: Who’ll get the death benefit if you pass away? It doesn’t he to be a family member. You can choose to lee some or all to a charity or even a friend. And it doesn’t all he to go to one person. For example, you could give 50% to your spouse and divide the rest between your adult children.

The different types of term policies

Level premium: Also called level term, this is the simplest, most common type of policy — your premium stays the same for the entire term.

Yearly renewable term: Also called annual renewable term. This policy covers you for a year at a time, with an option to renew (without a medical exam) for the duration of the term — but at a higher cost each year. Compared to level term, premiums will be slightly lower at first, but over a full 10-year, 20-year, or 30-year term, you'll pay more than you would with a level premium policy.

Return of premium: This type of term policy pays back all or a portion of your premiums if you live to the end of the term. What's the catch? Your premiums could be 2-5 times higher than a level term policy.2

Guaranteed issue: These policies are easy to get because they don't require a medical exam. However, your premiums may be much higher than other policy types and the policy may not pay a full death benefit for the first few years.

Benefits of Guardian level term life insurance

Cost-effectiveness: Term life is typically much more cost-effective than whole life insurance, allowing you to purchase a significant amount of coverage at relatively low rates.

Simplicity: Policies are straightforward and easy to understand, with a fixed death benefit and premium for the duration of the term.

Flexibility: Get coverage for a specific period, usually 10, 15, or 20 years. So you can match the coverage duration with your financial obligations, such as mortgage payments.

Convertibility: Our policies offer the option to convert to a permanent whole policy without a new medical exam, providing future flexibility if your needs change.3

Large death benefit: Term life allows you to secure a substantial death benefit at an affordable cost. And importantly, that money is paid to beneficiaries free of taxes.

Term life insurance vs. whole life insurance

Policy feature

Term life insurance

Whole life insurance

Initial cost

Typically, lower than whole life

Generally, 6x – 10x more expensive than term for the same death benefit; but as cash value builds it can be used to supplement premiums.

Cost over time

Renewal costs increase with age

Cost stays the same for life

Permanent coverage

Yes

Length of coverage

Typically, 10–30 years

Lifetime coverage (as long as payments are made)

Premium

Can be level or increase over the length of the policy

Level — stays the same every month

Heath exam required

In most cases

Cost can decrease over time

Yes — cost can be offset as cash value builds (typically after 12+ years)

Cash value

Yes – accumulates over time4

Ability to withdraw cash value during the life of the policy5

Yes – withdrawals and loans are allowed if cash value is ailable (but if unrepaid, this will diminish the policy values and death benefit)

Guaranteed death benefit

Yes

Policy structure and provisions

Relatively simple

More complex

Main disadvantages

Coverage terminates at end of term; doesn’t build cash value

Premiums significantly higher than term life

How to determine how much coverage you need

Here are a few general rules you can use to see how much life insurance is right for you:

10x your salary: This is one of the simplest rules to follow, but it probably doesn't consider all your family’s expenses and needs.

10x your salary plus college: If you add $100,000 - $150,000 for each child, that can help ensure that college won’t be a problem.

Use the DIME formula: DIME stands for Debt, Income, Mortgage, and Education. Total your debts, mortgage, and college expenses, plus your salary for the number of years your family needs protection (e.g. until the children are out of the house), and that's your coverage need.

Use the Human Life Value formula: This formula aims to calculate your future income potential and use that as the amount of coverage you need.6 The formula takes many factors into account, but a shortcut is to use the guidelines in the chart that follows. For example, if you’re between 18-40, multiply your income by 30.

Age

Maximum Life Insurance

18-40

30 times income

41-50

20 times income

51-60

15 times income

61-65

10 times income

66-70

1 times net worth

71-75

1/2 times net worth

How to buy term life insurance from Guardian

Many employers offers Guardian group life insurance as part of their employee benefits package. If it’s ailable, that can be a great place to start: Group premiums are typically lower than for an individual policy, and your employer may subsidize a portion of the premiums. However, the total amount of coverage ailable may be limited.

If life insurance isn’t offered at work — or the amount isn’t enough for your needs — the good news is that term life insurance is generally easy to shop for. And Guardian can give you an instant online quote.

Here are some qualities that Guardian offers

Keep in mind that policy ownership is a long-term relationship. Here’s what you’ll get with Guardian:

Financial strength7: First and foremost, you want a company with strong Financial Strength Ratings or FSRs, so you can be confident that they’ll be around when your family needs a payout years down the road.8 You can see Guardian’s current ratings here.

A company that underwrites its own policies: Guardian underwrites its own policies, but other companies may sell policies from another insurer. This can add an extra bureaucratic layer if you want to change your policy — or down the road when your family needs a payout.

Guaranteed term renewability: If you become critically ill near the end of your policy's term, you may want to renew without taking another medical exam. Guardian offers this on a year-to-year basis. While you can expect your rates to rise substantially, it may be worth it for your survivors.

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All Guardian term life policies are convertible. Here’s why that’s important

Your situation a few years from now could be quite different than it is today. Guardian lets you convert level term insurance coverage at any point in the first five years to a permanent life policy — and even offers an optional Extended Conversion Rider, which lets you do so for the duration of the policy.3 So you can get the term life policy that makes sense for you today and convert it into a permanent policy later if you decide it makes more sense for you. And importantly, you won't he to get a new medical exam. Since adults rarely get healthier with age, that means your rates and insurability are based on the best possible health rating.

Why would you convert to a whole life policy from term? If you've had a serious health problem — for example, a heart attack — it may be very difficult to get another policy after your term expires. Another reason is you’re attracted to the cash value component of a whole life policy. Or maybe you want permanent life-long coverage. A term policy may well be the option that suits you now, but things can change.

Get help finding the right Guardian life insurance policy

Want to talk things over with someone before you buy term life insurance? That's a great idea. Guardian can connect you with a financial professional who will listen to your needs, tell you how to meet them within your budget, discuss the types of life insurance policies ailable, and help you make the right decision.

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