Term Life – that’s what St. Louis Term Life Insurance is all about.FAQs

What is Term Life Insurance?

St. Louis Term Life Insurance or “term assurance” is life insurance that provides coverage at a fixed rate of payments for a limited period of time, the relevant term. After that period expires, coverage at the previous rate of premiums is no longer guaranteed and the client must either relinquish coverage or arrange to get further coverage with different payments or conditions. If the life insured dies during the term, the death benefit will be paid to the beneficiary. Term insurance is typically the least expensive way to purchase a substantial death benefit on a coverage amount per premium dollar basis over a specific period of time.

What does a term life insurance cover?

Term life insurance covers death by any cause except suicide in the first two years (usually). This includes death by illness (even if due to a pre-existing condition), death caused by accident (including while flying or participating in dangerous hobbies), and death by unknown causes (such as old age).

If your life insurance application asked about these things and you disclosed them, you are covered. If, a few years after taking out the Term life insurance policy, you develop a health condition or take up a dangerous hobby that led to death, that is covered, too. Of course, the policy must be in effect at the time of death, which for Term insurance means that you have paid regular premiums and not allowed the policy to lapse.

How Term Life Insurance Works

When you buy a term life insurance policy, the insurance company determines the premiums based on the value of the policy (the payout amount) as well as your age, gender, and health. At St. Louis Term, we require a medical exam – at no cost to you!

If you die during the term of the policy, the insurer will pay the face value of the policy to your beneficiaries. This cash benefit—which is, in most cases, tax free — may be used by beneficiaries to settle your healthcare and funeral costs, consumer debt, or mortgage debt among other things. However, if the policy expires before your death, there is no payout. You may be able to renew a term policy at its expiration, but the premiums will be recalculated for your age at the time of renewal. Term life policies have no value other than the guaranteed death benefit. There is no savings component as found in a whole life insurance product.

How long should your term life insurance last?

Your policy’s “term length” is the policy’s duration. Most term life insurance policies last 10, 20 or 30 years. Many companies offer additional five- or 10-year increments, some up to 35- or 40-year terms. Most individuals want a term length that covers the entirety of your financial obligations or outstanding debts.

What length of term life insurance should I get?

With a term life policy, you’ll choose a term length, usually anywhere from 10 to 30 years, and payments can be made monthly, quarterly, semi-annually, or annually. The coverage amount can vary depending on how much life insurance you need.

Does term life insurance end at a certain age?

Yes, generally term insurance policies end or expire at a certain age. The exact age depends on the policy, but age 85 is common. Term insurance policies are often renewable and convertible. That means they renew for a higher premium at the end of each term – 10, 20, or 30 for example.

Should you buy term life or permanent/whole life insurance?

Some financial experts advise people to go with term life insurance and invest money rather than buy a permanent policy. One reason some suggest term life is because it costs less. Plus, a permanent life policy’s investment rate can’t match the stock market.

Is ‘whole life’ life insurance a scam?

Whole life insurance is not a scam, but most of the time it would be a bad choice for most people. It is usually never a good idea to mix insurance and savings or investments together. Everybody’s situation is different, but most individuals are much better off buying inexpensive term life insurance and investing the difference on your own.