What Is Renewable Term Life Insurance?
When you get life insurance, you can rest assured that your loved ones will be provided for monetarily in the case of your untimely demise. A term life insurance policy covers the policyholder for a predetermined amount of time. The only time a death benefit is paid out on a term policy is if the policyholder dies while the policy is active.
The phrase “renewable term life insurance” refers to a certain kind of life insurance plan that can be extended after the first term has ended. In most cases, a policyholder can renew their coverage for an additional period without being required to pass a medical exam. The death benefit from the policy will continue as before.
Term life insurance plans that can be renewed often provide coverage for five, ten, or twenty years. Sometimes they aren’t even a full year long. Insurance policies that offer renewable terms are helpful since they give policyholders more freedom and peace of mind.
How Do They Work?
If your health declines throughout the policy’s term, you can still renew it under its “renewable term” clause. Typically, insurance companies will increase your premiums in proportion to the level of risk you present. The death benefit of the policy will stay the same as before.
You cannot be denied service if your policy has an automatic renewal clause. Your premiums may go up every year, but if your policy is like others, you can keep renewing it. If you’re looking for a policy with the option to renew every year, you’ll want to look into yearly renewable-term insurance instead of one with a renewable term clause. It’s renewable annually until you reach a specific age.
These plans provide a fixed death payout and assured insurability for a specified period. The premiums for annual renewable term insurance are reviewed every year, and they may go up as you get older. Last but not least, life insurance with a renewable term is different from a convertible term. With this alternative, you can change your term life insurance policy into a permanent one.
Benefits Of Renewable Term Life Insurance
The decision to obtain renewable-term life insurance should be made after carefully considering the policyholder’s financial situation and long-term demands. Below are some advantages of this coverage.
1. No Medical Exam
You can keep your current coverage and avoid having to retake a medical exam by opting for renewable-term life insurance. If your health has taken a turn for the worse or you have a medical condition that makes it challenging to apply for other forms of life insurance, you may want to look into renewable-term life insurance.
2. Affordable
It’s common for renewable term life insurance plans to cost much less than standard whole life insurance policies. This is because they do not accrue cash worth over time.
3. Convenience
There is no need to undergo medical examinations or medical underwriting while renewing a renewable term life insurance coverage. You won’t have to go through the trouble of getting new quotations and filling out a fresh application. Consider this a huge perk if your condition has improved since you first applied for coverage.
4. Flexibility
Insurance policies that offer renewable terms are handy since they give policyholders more freedom and peace of mind. If, at the time your insurance coverage ends, you still have significant costs, such as a mortgage or college tuition, to pay, these plans may be able to provide you the financial breathing room you need to meet those commitments.
After a policy has expired, it can be an excellent alternative for people who still want to protect themselves and their families.
Get In Touch With Franklin Life & Annuity
If you or someone you know is looking for renewable term life insurance in Texas, then Franklin Life & Annuity is your best option. We are one of the best life insurance agencies in Texas and offer a wide range of life insurance policies. Get in touch with us today to learn all about it.