Term Life Insurance
Term life insurance, otherwise known as term insurance, is a type of life insurance policy that is designed to pay out a lump sum of money in the event of your death. With ActiveQuote, it is easy to compare term life insurance quotes online from across the UK to find the best level term life insurance or decreasing term life insurance policy at an affordable price.
Why would I need Term Life Insurance?
Term life insurance gives you the knowledge that your loved ones are left financially secure if you were to pass away. Life Insurance is not just for the breadwinner of the family. It can cost a small fortune to replace a housewife/ househusband, and a life insurance policy will help with the cost of replacement childcare.
How does Term Life Assurance work?
Unlike whole of life insurance, a term life assurance quote is designed to protect you until a key date in the future. If you die within your life insurance term then your insurer will pay out the agreed lump sum of money. However, if you do not die within this period then you will not be paid, and your term life insurance premiums will not be returned to you.
There are two different types of term life insurance quotes: level term life insurance and decreasing term life insurance.
Level term life insurance
With level term life insurance, the lump sum of money stays the same throughout the policy. A level term life insurance policy is often taken out by a family who want to protect themselves until a particular time in their life, such as their children leaving home or retirement age. Level term life insurance is also used for covering an interest only mortgage.
Decreasing term life insurance
With decreasing term life insurance, the lump sum of money will reduce over time. A decreasing term life insurance quote is usually designed to cover a repayment mortgage. The premiums of this type of policy are normally cheaper than level term life insurance.
How much will Term Life Insurance cost?
You will find that term insurance premiums are cheaper than whole of life policies, because the insurer is not guaranteed to have to pay out. For more information on whole of life policies take a look at our life insurance guide.
The cost of term life insurance will depend on many things, including the type of term life assurance policy you buy and your own circumstances. Things that could affect the cost include:
- Your smoking status: Smokers will pay higher term life insurance premiums than non-smokers.
- Your age: Older people and those with medical conditions may have to pay more for their term life insurance quotes.
- Your choice of policy: A level term life insurance policy will usually be more expensive than a decreasing term life insurance policy.
- The sum assured: The more money you choose to insure, the more expensive your term insurance policy will be.
Don’t forget, a joint term life insurance quote may not be as cost effective as two standalone policies.
How much Term Insurance Cover do I need?
When you compare term life insurance quotes you need to consider how much money you want to leave behind. If you own your own home, you will need enough money to pay off your mortgage so your family do not risk losing the house. In addition, you may have outstanding debts that you want your term life assurance to cover if you were to pass away.
Ultimately, the amount of term life insurance you need will depend on your own personal circumstances, but don’t forget the more you cover the more expensive your term life insurance quote will probably end up being.
Are there any restrictions to Term Life Insurance?
Unlike whole of life insurance, a term life insurance policy will only cover you until a certain date. If you do not die during this time you will not receive the money, and your term life assurance premiums will not be refunded.
If you choose reviewable premiums rather than guaranteed premiums, you need to be aware that your term assurance policy cost may increase. Whilst reviewable premiums are guaranteed for a set number of years, you may find your term life insurance quote becomes unaffordable later in life.
Why should I find a Term Life Insurance Quote with ActiveQuote?
Finding the right term life insurance quote for your needs and your budget can be a difficult task, particularly with so many different options on the market. Luckily, ActiveQuote offers a comparison system where you can compare term life insurance quotes online in under two minutes. The benefits of using us to find term insurance include:
- Compare term assurance from leading insurers online
- Quotes in under two minutes
- Tailor your term life insurance quote to suit your budget
- Buy your term life insurance policy online