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Chuks Udo Okonta
Are you looking for an investment that would enable you purchase huge money with little cash, go for term assurance policy.
A term assurance is a money purchase policy that secures a person’s family financial status in the event of death of the assured life. So, a person can choose to buy any amount and pay the premium depending on age and circumstances.
A term assurance can be used as a collateral and to cover a mortgage (called mortgage protection assurance); and, in the event of the lender’s death, the family will not be disturbed as the insurer will pay off the debt.
If a pure term assurance is used for the mortgage protection, the insurer will pay off the debt and pay the balance, if any, to the family. So, yes, it “is like buying huge money with little money” for the deceased family.
More benefits
* Less expensive
Life insurance rates are more affordable for term than whole life insurance because term policies offer coverage for a predetermined time. If you outlive the term and the policy expires, your beneficiaries don’t receive the death benefit, so it’s less of a risk to the insurer.
* Flexible
You have many options when choosing how long your term life insurance should last. Typically, you can buy coverage for one, five, 10, 15, 20, 25 or 30 years. Policies that last for one or five years can help cover short-term debts or expenses you currently pay, like a child’s tuition. Alternatively, if you’re the breadwinner and want a policy to cover your mortgage, a 30-year term might be a better match. These needs disappear over time, and so might your need for a policy.
* Good for young families
Due to the fact that term life covers only a specific period and is generally less expensive than permanent life insurance, it’s a great choice for young families looking for temporary coverage. For example, you can buy a policy to cover the years your family relies on you financially, and lower your coverage when your children become self-sufficient.
*Simplicity
Term life insurance is simple and affordable way to safeguard the financial health of loved ones if something happens to them. It offers pure insurance. In comparison, with whole life insurance and other permanent policies, a portion of your premium goes towards building a cash value.
