What Is Level Term Insurance?
Life insurance is a policy that individuals pay into each year with the expected benefit of their beneficiaries receiving money when the policyholder dies. While many life insurance policies exist in the marketplace, level term insurance is the best option for most individuals.
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Rates
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The annual rates for level term insurance are fixed for the life of the insurance policy. While most rates start out very inexpensive, they do increase as the policyholder ages.
Length
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The most popular lengths of level term insurance are 10, 15 or 20 years. Some 30-year terms are offered by insurance companies.
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Death Benefits
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Level term insurance requires applicants to state the value of the policy they wish to purchase. While the policy values vary, Dave Ramsey, a nationally syndicated radio financial consultant, states most individuals should select a policy valued at 8 to 10 times their current income.
Renewal
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Level term insurance usually requires applicants only qualify once for the insurance policy. To ensure policy renewal, applicants may purchase a guaranteed renewal addendum for their level term policy.
Qualifications
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Applicants for insurance policies may have to meet certain qualifications depending on the insurance company. Smoking, blood pressure medication and other types of medication are determining factors for insurance rates.
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