About Level Term Life Insurance
At the end of your level term policy, if you do not die and you still want to continue to be covered, you will need to purchase another life insurance policy. Nevertheless, this will be depending on your age, health and lifestyle at that time, which may or may not qualify you.
Why Should You Select Level Term Life Insurance?
If you want to protect more than only your mortgage, a level term policy might be the right choice for you. There is a difference between level term policy and decreasing term policy where the former one tends to be more expensive than the later one, which is principally used for Capital Repayment Mortgages. According to the level term policy, the covered insurance amount will not be reduced, and it will be a suitable method not only for a lump sum payment to a loved one, but also for repayment of debts.
As an example, you may take level term cover while you take on a mortgage. However, if you were to loose your life while paid only half of mortgage then the policy payout would cover the remaining half of mortgage outstanding and the rest of the payout can be divided among your dependents.
Level term life insurance also suitable to cover the interest only mortgages, where the capital amount stays the same through the term of mortgage.
Are You Aware of the Benefits of Level Term Protection?
The amount insured or the premium will not change because the policy stays level throughout the policy term. This implies that you will always be paying the exact same amount for your life insurance coverage, and it would not fluctuate over the policy term.
If you want to leave a lump sum for your loved ones, then a Level Term policy could be the right option for you. We offer free trust arrangement services so your family won’t have to pay high inheritance taxes when it comes time to pay.
Taxation and fiduciary planning are not regulated by the Financial Conduct Authority.
Are There Any Possible Concerns for Level Term Policy?
If
you only want to cover your mortgage costs, a Decreasing Term Policy may be comparatively more appropriate as well as more cost-effective than a Level Term policy. Decreasing term policies are only suitable for capital repayment mortgages, but not for interest-only mortgages.
However, a Level term insurance may cover you more than you need. You may believe that you are going to benefit your family by getting a life insurance cover, which covers your mortgage and personal/family protection side as well for hundred of thousands pounds in case of death; but all of this just pushes up your monthly premium. As a result, you may end up paying high premiums and can loose the entire cover if you are unable to afford it.
Level Term Insurance is not for the whole life. If you don’t want to limit the coverage period, whole life insurance is worth considering.
You can obtain a single or joint policy which is a Level Term policy for you alone or you and your partner respectively. A possible concern of joint term insurance is that if one of the two policyholders dies, the other is no longer co-insured and needs new life insurance to ensure life protection. Keeping that in mind, it is advisable to set up two single Level Term policies to ensure both partners are protected no matter whatever the situation may be. In some cases, we can also set up joint insurance for you that pays out after the second person dies. If you are interested, we can help you set it up.
Protection plans have no cash value and coverage ends at maturity or if premiums are not maintained.
Are There Any Possible Concerns for Level Term Policy?
As with all life insurance policies, there are certain factors that will affect your monthly premiums as well as how much coverage the insurance company is willing to provide you. Your cover can be greatly affected if you are going to be deemed ‘riskier’ than others. Some of the factors are:
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