I am not sure that anyone could say that term life insurance is often the best value without knowing a person's exact situation. Term life insurance is the most affordable compared to permanent or cash value insurance, but it may not be the best value. If you purchase a 20 year term policy at age 30 and have a heart condition at age 48 and lose insurability, it will be very difficult to obtain any type of life insurance after age 50 when the term expires. There are many arguments to be made with the different types of life insurance plans. The one that is best for your unique situation and laid out by a caring knowledgeable advisor is the best value for you specifically.
President, The Firm of Steven H. Kobrin, LUTCF, 6-05 Saddle River Rd #103, Fair Lawn, NJ 07410
Term insurance is often the best value in a specific set of circumstances.
These are:
You need life insurance for a limited amount of time;
You want to pay as little as possible for that coverage;
You have no need for the advantages of accumulating cash inside life insurance.
Let’s suppose you have a personal loan such as a mortgage, or a bank loan for your business. You need life insurance to cover those liabilities. You have other policies in force to take care of your family and your estate.
So, you pick up a term policy to cover that specific need.
Maybe you unfortunately are getting divorced, and the decree requires a policy for a set amount of years. Or, you start a business with a partner, and you need to fund your buy-sell agreement up to a certain age.
So, you pick up a term policy.
Let’s suppose you have a disciplined savings program and are accumulating wealth in a number of vehicles. You have many investments, and they range from aggressive to conservative. No real need to use life insurance to grow cash. But you do need coverage.
So, you pick up a term policy.
In these cases, permanent, cash value insurance might be overkill. You don’t have to spend extra money in premium for a long-term guarantee you don’t want, and for cash you don’t need.
Just make sure you know what you’re doing, because if it ends up that you do want life insurance after the term policy renews, all bets could be off. The price could be high, and you also run the risk of not being insurable. Bear that in mind.
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These are:
You need life insurance for a limited amount of time;
You want to pay as little as possible for that coverage;
You have no need for the advantages of accumulating cash inside life insurance.
Let’s suppose you have a personal loan such as a mortgage, or a bank loan for your business. You need life insurance to cover those liabilities. You have other policies in force to take care of your family and your estate.
So, you pick up a term policy to cover that specific need.
Maybe you unfortunately are getting divorced, and the decree requires a policy for a set amount of years. Or, you start a business with a partner, and you need to fund your buy-sell agreement up to a certain age.
So, you pick up a term policy.
Let’s suppose you have a disciplined savings program and are accumulating wealth in a number of vehicles. You have many investments, and they range from aggressive to conservative. No real need to use life insurance to grow cash. But you do need coverage.
So, you pick up a term policy.
In these cases, permanent, cash value insurance might be overkill. You don’t have to spend extra money in premium for a long-term guarantee you don’t want, and for cash you don’t need.
Just make sure you know what you’re doing, because if it ends up that you do want life insurance after the term policy renews, all bets could be off. The price could be high, and you also run the risk of not being insurable. Bear that in mind.