Policy Types

What Kind of Term Insurance Does My Family Need?

Because life insurance companies offer similar term life products, it's important to remember what components to research when comparing term life insurance policies and insurance carriers.

Comparing Term Life Insurance Plans for Your Family

With its simplicity and affordability, term life insurance can be part of a smart plan to get the coverage your family needs. But with many life insurance companies offering similar term life insurance products, what should you consider when comparing policies to find the plan that’s best for you?

Consider the following when comparing term life insurance policies:

The carrier’s financial strength and reputation

Picking a company with a strong financial rating is a good way for you to filter through your selection of plans. Although cost can often be a prime determining factor, you should consider selecting a solid life insurance company that will be there for you when you need it. Start by looking at the company’s A.M. Best rating, which grades carriers on a scale from A++ to F. Depending on the grade, you can immediately see how financially sound they are. Also, do some additional research online to see what other customers are saying about their experience with the carrier. When looking through client reviews, focus on customer service, product satisfaction, and claims processing speeds.

The conversion clause

Most term policies can be converted to cash value policies under certain conditions if they contain a convertibility clause. Convertibility simply means that your term policy can be exchanged for permanent life insurance of equal value, typically without any underwriting or medical exam. For example, if you have a $50,000 convertible term policy, you could convert it into a $50,000 permanent life policy without providing health history. Because conversion clauses vary considerably, you should carefully read the conversion clause of any term policy you consider buying.

Policy riders/endorsements

Depending on the life insurance company, each term life plan will typically have a variety of add-on coverages, commonly known as policy riders or endorsements. Riders can give additional benefits to your term policy and enhance your coverage. Available riders vary by insurance company and policy, as do the rules for how they work. Costs also vary and depend on many factors, including your age, health, and type of policy. Some of the most useful riders include: accelerated death benefit rider, accidental death benefit rider, guaranteed insurability rider, waiver of premium, and disability riders. Select riders based on your needs, because you may not find all of them to be worth the additional cost.


When it comes to budgeting for life insurance, affordability is an important determining factor. Naturally, the premium for a five-year policy will be less than that for a 30-year policy, so it’s important when comparing policies that you’re comparing apples to apples. Therefore, if all else is equal, then selecting the policy with the lowest premium may be the best choice.

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All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax‐related decisions. For information about Protective Life and its products and services, visit a href="http://www.protective.com" title="www.protective.com">www.protective.com.

Compare Term Life Insurance Rates

It is important to compare term life insurance rates when choosing the term life insurance plan for you and your family. This article shares a few important facts to consider when making that choice. For more information, visit our learning center.