When buying the term life insurance, you should know about your premium options. There are two types of premium options offered by most of the insurance companies. The premium options offered are guaranteed premiums and non guaranteed premiums.
Guaranteed premiums
If you opt for the guaranteed premiums then your premium rates are fixed and won’t change during your term period. This option is generally available for 5 years, 10 years, 15 years 20 years and 30 years of term period. The premium is fixed at the time of buying the term life insurance policy. It won’t increase or decrease during the entire term.
Non Guaranteed premiums
If you opt for the non guaranteed premium then your premium rate is not fixed and may change during your term period. This option is also available for 5 years, 10 years, 15 years, 20 years and 30 years of term period. The premium of this type is not fixed and may increase according to the various factors.
As such the premium of guaranteed premium is much higher then the premium of non-guaranteed premium. You should be aware of these options at the time of purchasing the term life insurance. You may be thinking that you have done a good bargaining and take the term life insurance for 15 years. But in reality you are covered for 15 years with may be only 5 years of guaranteed premium. So your premium does not increase during the first 5 years but after 5 years your premium won’t be the same. It increases every year after 5 years, depending upon your health and other factors.
|
