How long should my level term life insurance last for ?
Term life insurance offers you cover over a set length of time. The policy will only pay out should you die within the duration of the term. Once your policy has reached its term you can renew the insurance policy with a new premium.
Most people will take out a term life insurance policy to cover them for a specific length of time. This could include for the length of a mortgage repayment or until any children you may have can cope financially on their own. It is also useful to help put towards any funeral costs.
There are several types of term life insurance available but the most common is level term. This basically means that it will pay out a lump sum if you die within the specified term. The total that you are covered for will stay the same throughout the term of the policy. It is also a good starting point in insurance terms and allows you to can convert it to a universal or whole life policy.
Factors to consider
When taking out a level term life insurance policy you can take out one policy that will be large enough to offer your family an adequate level of cover to pay off any debts and the mortgage. You may want to think about separating your life insurance and having separate policies to cover different things.
A level term policy is a good idea if you have an interest only mortgage but you may also want to consider a decreasing term life insurance policy if you have a repayment mortgage.