Finding a Life Insurance Plan
That's Just Your Type
Contributed by ieee financial advantage
Life insurance. Almost every family needs it. Most
families — especially professional families like those of IEEE
members — already have some, but many probably need more.
Although most of us don't like to spend a lot of
time contemplating our own demise, we realize that buying life insurance
coverage is a critical financial planning decision we have to make.
Not so much because of the purchase price involved, but because of
the financial security that coverage is intended to provide at some
time in the future for the people we love and care about.
The first question most of us usually ask is: "How
much coverage do I need?" The IEEE's Learning Center [www.ieeeinsurance.com]
offers excellent calculators and worksheets to help you calculate your obligations
to determine a fairly
accurate figure that makes sense for your family's protection. The
second question we should ask is: "What type of life insurance do I
need?" The answer to that question is not so clear-cut, but it is
just as important — to get the best possible protection for
your family. Term life is one of the most basic types of life
insurance that is typically available to you in today's insurance
market. This article will take a closer look at this highly popular
form of insurance for you to consider before making your next life
insurance buying decision.
What is Term Life Insurance?
Term life insurance is the simplest form of life
insurance. In fact, you'll often see it referred to as "pure
protection," because it is designed to do only one thing: pay a death
Since your premiums buy protection only, term life
provides the maximum amount of protection for every dollar you
spend. So, with term life you can add larger amounts of coverage to
your life insurance portfolio, or create a larger instant estate if
you don't already have life insurance.
Term life coverage lasts for a specified period of
time (the "term"), usually one, five, 10 or 20 years. During that term,
the premiums stay the same, as determined by your age when you
initially buy the policy. Some policies, especially those with
longer terms, are sometimes referred to as level term
insurance because the premium stays level for a set number of years.
Term policies may often be renewed for more than one term, but the
premium will go up to reflect your age and possibly health at the
start of each new term. And most term policies have a termination
age, usually somewhere between 70 and 80 years of age.
At younger ages, when the step-up in premiums at the
start of each term is usually smallest, the pricing of one-year or
five-year term policies is usually the most attractive. The initial
cost of policies with longer terms, such as 10 or 20 years, usually
starts out somewhat higher than shorter-term policies for the same
amount of coverage. But in the long run, longer-term policies may offer cost
advantages because the premiums are locked in at the same level
for longer terms. This advantage can be especially important for buyers in
their late 40s, 50s, and 60s, when premium increases at the
renewal of each term tend to be greater.
A level term life insurance policy is also an excellent way to
add a significant amount of protection — over and above any life
insurance coverage you already have — that lasts for a specific
period of time or for a specific purpose. For example, you might
want to take out a 10- or 20- year level term policy to provide
needed protection at a locked-in rate until your children are out of
college, the mortgage is paid off, or some other event reduces your
overall need for life insurance coverage. Your premium will stay the
same during the term you select.
Your Source for Top Quality Coverage
In today's marketplace, life insurance plans have
proliferated. At any time, you can find insurance offered not just
through local agents, but through the Internet, your bank, credit
card or mortgage companies, and even grocery and bulk warehouse
stores. Some of these offers may appear to be exceptional deals.
However, fine print and clauses may make the "great deal" only
available to a small percentage of the applying population.
So, being a well-informed consumer is essential.
The IEEE Group Life Insurance Program for active
includes Group Term Life Insurance, Group 10-Year Level Term Life
Insurance and the Group Level Term Life Insurance to Age 65 Plans. These life insurance
programs have been vetted through industry professionals and IEEE
volunteer member committees. Very competitive pricing has been
secured with the buying power of the entire organization and the
plans are underwritten by an industry leader, New York Life
Insurance Company. These policies also offer discounts for qualified
non-smokers and higher volumes of insurance. Plan details,
including features, costs, eligibility, renewability, limitations
and exclusions, along with applications and simple price quotes, can
be found at the user-friendly IEEE insurance site [www.ieeeinsurance.com] or
by calling 1-800-493-IEEE (4333).
Once you have the basics down, finding the right
insurance for you and your family will be an easier decision. And
with the many plan options available to members, IEEE is confident
one will be the right choice for you.
The IEEE Group Life Insurance Plans are underwritten
by New York Life Insurance Company, 51 Madison Avenue, New York, NY
10010: under Group Policy No. G-8100-1, on Policy Form GMR-FACE/G-8100-1,
with respect to Term Life and Level Term Life to Age 65; and under
Group Policy No. G-29133-0, on Policy Form GMR-FACE/G-29133-0, with
respect to the 10-Year Level Term Life.
For more information on the IEEE Financial
Advantage Program, visit
www.ieee.org/fap. Comments may be submitted to