Overview: A Level Term Life Insurance is one that recompenses a lump sum to the family of the policyholder if he/she dies before the policy term expires.
A Level Term Life policy offers financial security to your loved ones when you are not around. It costs more than decreasing life insurance, however, this particular type of life insurance pays out a fixed value or ‘level’ lump sum until the policy ends, unlike decreasing term life insurance.
The Working Scheme:
Level term insurance gives a death benefit to your beneficiaries in the event of your death, provided the insurance term is still valid. It only works for a given term or duration. The amount paid by the insurance at your death varies depending on your policy. However, if you die after your insurance term expires, the payout will not be granted.
In case you are still alive at the end of the insurance policy, your insurance will simply be terminated and no benefit or money return is received.
The cost of your level term life insurance depends on your choice of cover and your age. The higher the death benefit you want to leave behind for your family, the higher the amount of your monthly premium. You can still avail of suitable level life insurance policies if you have certain medical conditions, however, the cost of your policy will be relatively higher.
A level cover offers a fixed sum of cover which does not adjust with inflation, meaning its value gradually decreases. Increments in the amount of insurance cover and monthly premium can still be made by the policyholder.
A level cover life insurance can prove beneficial if you have outstanding mortgage and loans and has suitable advantages over decreasing term life insurance while having a few notable disadvantages.
Therefore, the suitability of the policy largely depends on the client as in some cases the advantages can outweigh the drawbacks and vice-versa.
We would recommend you to talk to one of our advisers for life insurance quotes.
Any quote that your adviser provides you with will take into account your circumstances, your medical history, as well as your budget!
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