By the Book: Term Life Insurance Definition

A term life insurance package offers death benefits to family and loved ones of an insured. The policyholder stipulates the term of the contract initially--terms can last up to 30 years or can be as short as one or five years. Typically, if the policyholder fails to abide by stipulated terms in the life insurance contract, the carrier can cancel coverage instantly.

Some term plans allow policyholders to stockpile premium payments to mitigate against potential missed payments down the line. For instance, you may over pay one year by $300 on the off chance that on some given month you may fail to send in your life insurance payment. Not all term life insurance policies come with these cushions--you can discuss the intricacies of various carrier programs with an EFinancial.com associate at any time at 866-765-4296 (a toll-free call).

EFinancial deals with the best of the best and even offers unique term life policies that combine the best features of popular offerings. In terms of crafting a smart coverage plan for your family and lifestyle, you need to look at more than just your income streams and liabilities (e.g. mortgage payments, college tuition bills on the horizon).

Experts recommend that term life shoppers consider the ramifications of the loss of a family breadwinner. Your survivors may have to pay for funeral costs, outstanding bills, estate taxes, and ongoing expenses. At minimum, you want your term policy to pay out at least five times your yearly gross wages.