Why Term Life Insurance?

We have heard that there are many types of life insurance available in the Philippines. It is 2019 after all. More and more Filipinos are becoming interested in getting a life insurance policy. But then all the terminology can become confusing, especially if you will be hearing them for the first time.

This article is meant to give you a better understanding of term life insurance. It is important to gain an understanding of the life insurance package that you are going to get, or else you might end up paying for something that is very expensive with add-ons that you do not really even need.

What is term life insurance?

As its name would suggest, term life insurance covers a person for a set amount of time. The term would usually last for anytime from one year to 30 years, but some companies can offer it for a longer period. The term would stipulate that if the death of the policyholder would fall anytime between the term, the amount of the policy would be given to the family members or beneficiaries.

Is it better than whole life insurance?

In some cases, it would be more advisable to get a term life insurance rather than a whole life insurance policy. However, it all depends on you, what you are capable of doing and what your needs are.

The reason why whole life insurance is more expensive than term life insurance is because the rest of the investment outside of the death benefit amount is invested.

This is the reason why your financial advisor or insurance agent would give you a range of amounts to expect after your payment term for the whole life insurance would be finished. They would invest the money into the stock market. The amounts that they would be showing you would be the estimated amount after the payment term. 

If you are knowledgeable in stocks, it might be a better option for you to invest in a term life insurance policy and invest the rest of your money in the stock market, since that would be exactly what would happen if you had gotten a whole life insurance package.

Of course there would be some added fees of the life insurance company. This is why if you know how to invest in stocks, you can be able to save the fees that you would be paying the insurance company and just invest in stocks yourself.

Insurance is meant to protect your family from financial problems in case you die.

That is the bottom line of what insurance is designed to do. Talking about death is not the best topic in the world, but it is a good thing to just be prepared for if and when it will happen. We are all headed there anyway. The only people who do not need life insurance would be vampires, maybe. Because they are immortal and they would never die. If you do not happen to be a vampire, you would need life insurance.

In the end, that is what counts. You would want to be able to sleep at night knowing that no matter what happens to you, your family will never have to worry about paying for your funeral and memorial service.

You will have taken care of that for them already – with your life insurance plan. Along with that, you will also be able to provide them with the cash benefit they would receive in case you die. That is what everyone needs in a life insurance plan, and you can get it with a term life insurance plan.