Steady As She Goes: Level Term Life Insurance

As its name implies, a level term life insurance plan provides its owner with level premiums. When you buy a guaranteed level term life insurance plan through EFinancial, the premiums will stay the same for the length of the term: if you're paying 50 dollars a month for the 30-year plan today, you'll still be paying 50 dollars a month for it 29 years from now.

With inflation, you can naturally expect this 50 dollars to be worth a lot less in the future (particularly the distant future). For this reason, premiums may seem slightly expensive at first--especially if you buy a term life insurance plan for a very long term, such as 30 years. However, guaranteed level plans are still in high demand. Many buyers, brokers, and agents consider level plans more desirable than ART (annually renewable term) insurance plans.

ART plans are the opposite of level plans; with ART policies, the premium increases every year. This can be beneficial in the beginning of the policy's term, when premiums are likely to be lower than those of a level plan. However, premiums which increase every year can become difficult to pay for over time. Owners of such plans are unable to budget their premiums into a long-range financial plan because they never know how much the premiums will increase.

A word to the wise: make sure your level term life insurance plan is guaranteed before purchasing it. Unless an insurer guarantees that its plan is level, the insurer is legally allowed to raise premiums over time. If you have any questions about a particular plan you find through EFinancial, feel free to call a licensed agent at 1-866-765-4296 to discuss the matter.