T1-L1-P15

Features of Term Life Insurance

Option to Renew:

There are several features that are desirable in Term life insurance policies.

One of these is Guaranteed Renewability. Under a policy that's guaranteed renewable, the insured does not have to undergo health underwriting each time the end of a term arrives. The policy is guaranteed to renew without the insured having to provide proof of good health. The cost of this feature is built into the premium.

A policy might be guaranteed renewable until age 95, or perhaps 85, or maybe only 60. And of course, one that is guaranteed only to age 75 will have a lower premium than the one that is guaranteed renewable to age 95; this is because between 75 and 95, one is much more prone to encounter health problems that shorten longevity than they are prior to age 75. So the guaranteed renewability is an important feature.