The most significant advantage of term life insurance policies is the options it provides to the insurance seeker. Apart from being very cheap, it also allows a person to choose his own term or duration of insurance. For instance, if a person feels that he doesn’t want to have longer period of term insurance, then he may opt for Term Life Insurance, or 10 year term life insurance. Likewise, a person may even go for 30 year term life insurance, if he wants to. Many insurance seekers are very confused when they have to choose short term life insurance.
When does a person require 5 Year Term Life Insurance
A person usually needs such a policy as an attachment to other policies. It is short, and also much cheaper. What it does is it provides the insured to have additional insurance for a very short term, which may not be available with the existing insurance. Since it is cheaper, it gives more reason for insurance seekers to buy one as cushion against unwanted damage.
Another very significant advantage of having 5 year term insurance is when a person seeks loan. Many loan institutions are afraid of losing money in the eventuality of death of a borrower. If a loan borrower has short term insurance, and the lender comes to know of it, then the institution may provide loans, just because the organization has certainty of receiving payment, even if the borrower meets an untimely death. A person can therefore, take advantage of 5 year term insurance and can even have loans.
A 5 year term life insurance is also very helpful in paying off college fees. There are times when dependents may find hard to pay off college fees, especially after the demise of the head of the house. If the head of the house has 5 year term life policy, then the dependents can claim benefits to pay off education fees.
5 Year Term Life Insurance is not very popular
The benefits of 5 year life policy certainly outweigh its disadvantages. However, still many are not aware of its list of advantages. The reason behind lack of popularity of this short term insurance is that the insurance agents had not promoted the policy much. The commission structure of such short term policies are lower for an agent, and therefore the agents are happy to stay away from it, selling policies they feel will bring higher
profit.
Most striking advantage of 5 Year Term Life Insurance
This short term insurance policy can be used as an attachment to other life insurance policies. Even though, the insured may have two policies simultaneously, yet, the beneficiary will receive twice the sum as benefit in case of accidental death of the insured.
The other major benefit with a 5 Year Term Life Insurance policy as a rider is waiver of premiums, in cases of temporary disability, which means that the company will pay the premiums, provided the insured has had a policy for at least 6 months.
