Term Life Insurance
Term life insurance offers an affordable means of securing protection for a specified period of time. While term life insurance does not build cash value like whole life insurance, it comes at a reduced cost with less stringent underwriting requirements, making it more cost-effective and accessible.
In the Q1 2020, the US life insurance industry lost more than $50B, as most life insurance companies participate in the stock market to generate their returns. This loss will have a greater impact on universal life plan pricing than it will term insurance. Term life is more insulated from market volatility largely because it carries no cash value, unlike whole life policies. Even during the global COVID-19 pandemic in 2020, term life insurance has largely maintained both pricing and underwriting process.
Why DPL Likes Term Life Insurance
Term life insurance offers an affordable solution for ensuring your clients' loved ones are provided for and that beneficiaries aren't burdened by legacy debts. Term life insurance polices are designed to insure a policy owner for a specific period of time. While term life insurance carries no cash value like whole life policies, the reduced costs can allow clients to invest the difference in premium in more growth-oriented assets to further "self-insure".
Term life insurance often requires a less stringent underwriting process than whole life, enabling a quicker issue of policies. Additionally, some term life policies offer the option to convert to a permanent policy, which can protect clients if their health changes after purchasing a term policy.
How to Think About Commission-Free Term Term Life Insurance
When your client needs:
LIFE INSURANCE: Term life insurance pays a death benefit to help client beneficiaries meet their current needs. It allows clients to qualify for life insurance based on their current health, and provides cost-effective coverage for short- or long-term needs.
LEGACY PLANNING: Term life insurance provides the flexibility to convert the Term policy to a permanent policy in the future, helping to solidify estate plans if a client's health changes after the policy is issued.
1Knueven, L. (2020, June 23). The US life insurance industry lost $50 billion in the first quarter of 2020, but the cheapest type of life insurance should also be the least affected. Retrieved September 03, 2020, from https://www.businessinsider.com/personal-finance/life-insurance-industry-lost-money-term-policies-unaffected-2020-6
2Knueven, L. (2020, June 15). As the coronavirus pandemic lingers, life insurance companies are getting stricter about who they will cover. Retrieved September 03, 2020, from https://www.businessinsider.com/personal-finance/life-insurance-changes-coronavirus-affect-international-travelers-seniors-2020-6
3Applicants qualify for Accelerated UnderwritingSM based on age, personal history and face amount requirements.
Have more questions about Term Life Insurance?
Call us at 888.327.0049 to speak to a DPL Consultant.