What is the difference between Level Term Life and Term Life?
A Level Term policy means that the rates are guaranteed for a specific length of time. In this case, the rates are guaranteed not to change for 10 years after the initial coverage effective date. With Term Life, your rates renew annually as you age.
What happens to my coverage once I’ve reached the term?
At the end of your initial term, you may reapply for another 10-year term, provided you still meet eligibility criteria. You will be subject to the rates and underwriting requirements in effect at the time of re-application. Or you could continue your existing coverage until age 75, but on a non-guaranteed rate basis. You will not be required to re-apply for coverage and submit to medical underwriting if you choose this option, but your premium will increase according to your age.
I’m a little bit older, should I consider a whole life policy?
That’s an excellent question. Whole or permanent life policies can be a good resource. While a policy like this can build cash value, such values are based on projections and subject to market fluctuations. With term life, you know exactly what coverage you’re paying for.
Have more questions?
For more information on this coverage – features, costs, eligibility, renewability, limitations and exclusions – click on the Learn More section on the right or contact an NJCPA insurance specialist.