Policy Types

What is Term Life?

What is term life insurance and how should you use it? Find out whether this type of temporary policy is best for your needs.

Term Life Insurance Explained

Often considered a temporary policy, term life insurance is only meant to cover you for a specific “term” or period of time during which the premiums may remain level. Coverage may continue after the level premium term but typically at higher premiums or with reduced face amounts. This can be anywhere from one year up to 30 years. If you were to die unexpectedly during that specific term, your beneficiaries will receive a set payout (known as the death benefit) as specified on your policy.

Being simple in concept, term life can help you affordably address the difficult question of how your family will financially manage if you were to pass away unexpectedly. Key benefits include:

  • A fixed level premium that won't increase
  • A level death benefit that guarantees that the amount of coverage will stay the same (won't decrease) for as long as you own the policy (the length of the term as long as the premiums are paid.)
  • The ability to choose the term length that best meets your needs - typically 10,20, or 30 years
  • Typically offers low initial costs with coverage with limits ranging anywhere from $5,000 to several million

What can term life insurance be used for?

Term insurance can be used for many different purposes. Some common uses for term life may include:

  • To replace your income if you were to die unexpectedly
  • Help your family cover your final expenses and medical bills
  • Leave your family with enough money to pay off debts such as a mortgage
  • Ensure your children are left with money to help pay for college
  • Provide required coverage as per a divorce settlement
  • Can be used by businesses for key person insurance or buy/sell agreements
  • Provide temporary life insurance coverage if you're in between jobs

Who should buy term life insurance?

Just about anyone who is looking for affordable coverage for a specific length of time. For example, homebuyers may want to purchase a 30 year term policy to coincide with their 30 year mortgage loan. In the event the primary wage earner were to die before the loan is paid (anytime during that 30 year time period), your loved ones would be able to pay off the mortgage free and clear.

Welcome the Protective Learning Center

At Protective, we understand the importance of being educated on what types of life insurance will best fit your needs. That's why we continue to publish informative term life insurance articles in our Life Insurance Learning Center. These articles are here to help you better understand how term insurance works, how it is used, as well as other information on its many benefits.

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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.

NeitherProtective 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 aboutProtective Life and its products and services, visit www.protective.com.


Term Life Insurance

Term life insurance can provide affordable, basic coverage to serve a variety of needs. At Protective Life, we want to help you learn about term life insurance so that you can make the right choice for you. Whether you need term life insurance to cover final expenses or to be there to cover a mortgage loan, term life insurance offers many benefits. For more information, visit the Protective learning center.