You might know the basic differences between term and permanent life insurance. But are you aware of how this choice may affect your options in the future?
Term life insurance is often a good choice for an individual or a family in earlier years, especially if the budget is tight. It allows for affordable, yet high levels of coverage when the need for protection is often greatest.
While term insurance can provide low-cost coverage for a specific period of time, it does have an expiration date—10, 20, or 30 years, for example. That’s why it’s called “term” insurance. If you buy a 10-year term policy and then, at the end of that 10-year term, realize that you still have a need for life insurance, you may not qualify for the same rate you did 10 years ago. It could be because of your age, or your health may have deteriorated. Other factors also affect your underwriting class. In fact, you may find that it's too expensive to renew your policy, or you may not even re-qualify at all.
Here’s where permanent life insurance can be a great option to address these concerns.
Permanent life insurance is designed to provide lifelong financial protection. Because permanent life insurance policies are designed and priced to keep over a long period of time, this may be the right type of insurance for you if you have a long-term need for life insurance coverage.
"Permanent insurance" is generally a catchall phrase for a wide variety of life insurance products, many of which include a cash-value feature. Within this class of life insurance, there are many different products, including universal life insurance and indexed universal life insurance.
Despite what many people may think, the need for life insurance often remains long after the kids have graduated college or the mortgage has been paid off. If the unexpected happened, you or your spouse could still be faced with daily living expenses. And if your spouse outlives you by 10, 20, or even 30 years—would they be able to maintain the lifestyle you worked so hard to achieve? Would you be able to pass an inheritance on to your children or grandchildren? These are questions to consider carefully when determining what type of life insurance fits your needs.
Be sure you carefully consider your needs and how they may evolve down the road, and discuss them with your life insurance agent. If your needs will remain temporary, then term insurance may be right for you. But, if you think there's a possibility that you might need the coverage for a long time, then consider a low-cost permanent solution, like guaranteed universal life insurance.
Learn more by talking to your Midland National representative today!
Indexed Universal Life products are not an investment in the “market” or in the applicable index and are subject to all policy fees and charges normally associated with most universal life insurance.