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Decreasing term is very popular with home owners and mortgage companies. The homeowners want to know that the mortgage is paid off if they should prematurely die, and the mortgage company want to be assured that they are repaid the money loaned to the homeowner. The face amount of these term life policies decrease in a uniformed manner each year as the balance owed on the mortgage decreases, and the premium remains level. This is very inexpensive life insurance.
This is initially the cheapest life insurance you can buy. The death benefit remains level for the duration, however, the premiums increase every year and as a result this may turn out to be the most expensive term policies you can buy. If you should purchase this policy it would be wise to convert to a level plan as quickly as possible.
The face amount of this 5 year term life policy remains level for the entire 5 year period and so does the premium. Upon death the face amount is paid either in one lump sum or in the form of an income. If you have a short term need for life insurance, like covering a bank loan, then this may be the plan for you.
Like the 5 year term policy, the 10 year term life policy can be used to cover a bank loan, but it can do considerably more. It can be used for family protection and a myriad of other needs. The face amount of the policy remains level for the duration and so does the premium. Some companies allow you to continue the policy after 10 years with an increase in premium.
The 20 year term insurance policy is probably the most popular of term life policies. The death benefit remains level for the duration and in some cases so does the premium. With some companies, however, the premiums increase after the first 10 years to reflect the cost of the additional risk to which the insurance company is exposed as the insured gets older. All in all, the 20 tear term life insurance policy is fairly inexpensive and does the job it is intended to do.
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