Cheap Term Life InsuranceCheap term life insurance refers to cost -- not quality and is the main stay of the insurance business. It normally comes in in two versions. Convertible and renewable and non-convertible and non-renewable. What's the the difference? Renewable and convertible cheap term life insurance is term insurance that gives you the opportunity to renew your term coverage up to a certain age (normally 75) or convert your coverage to some from of whole life policy - regardless of your health at the time. Meaning even if the Doctor told you only had months to live. The insurance company cannot say NO! Non-renewable and non-convertible term insurance Does not allow this! Both are considered cheap term life insurance and are virtually identical. A term policy - non-renewable/nonconvertible - once expired. means you no longer have any life insurance coverage. Term life insurance is temporary insurance which can be available in 5-year, 10-year, and 20-year terms. This means the coverage and price are guaranteed for the length of the term and cannot be changed without setting up a new policy. One of the better known versions of cheap term life insurance is called
“Mortgage Protection Insurance”
and can be purchased through the Bank.
I went to see an older couple. He was 79 and she was 68. The asked me to look over their Insurance policies. Both policies -- were nonrenewable and nonconvertible. His policy ended at age 80 and hers at age 69. They each had one more year, then the Insurance coverage was gone forever. Realizing their coverage was expiring they applied for new insurance policies. Because he had had a heart attack. He was declined by the insurance company. Even though but had recovered quite well and exercised each day. His insurance coverage came to an end. We did an application for her as well. Her health situation caused her to be rated at double premium cost. This was too expensive for her and she decided not to go ahead with the policy. The result, after paying for life insurance all their lives. They now had no coverage at all. The lesson? Revisit your life insurance coverage every few years. Have your insurance agent clearly spell out what you have. To make sure it is the right thing for you. Case Study I had a client, to whom I sold a 20-year term policy several years ago. I was checking Insurance company rates a few years later and discovered that if he got a new policy he would get more coverage and pay a lower premium. Which is exactly what we did! Term Life is great temporary Insurance to protect your family. The cost is guaranteed. The payout on death is guaranteed and proceeds are 100% tax free.
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Terry Johnston CFPJ C Mitchell Financial Services Inc. Phone: 866-721-7781 ext. 232
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