Life & retirement income
Term life insurance
The most death benefit you can buy per dollar of premium, for a defined number of years. For most families with a mortgage and children at home, this is the honest answer before anything more complicated is discussed.
Worth considering if
- You have a mortgage, and a surviving partner who could not carry it alone
- You have children who need supporting through school
- You want the largest possible death benefit for the smallest premium
- You have a business loan or personal guarantee to cover
- You want coverage during your working years, not for your whole life
Watch out for
- It expires. Renewal after the level term is possible but the price jumps sharply
- Buying too short a term is the most common mistake — match it to the obligation
- Not every policy includes a conversion rider; the good ones do
- Group life through your employer usually ends when the job does
- Waiting costs money — premiums are priced off your age at issue
How much coverage, honestly
The rules of thumb — ten times income, twelve times income — are starting points that ignore the specifics that matter. A better method is to add up what actually has to be paid for, and subtract what already exists to pay for it.
On the obligations side: the outstanding mortgage balance, other debts, the cost of getting each child through education, funeral and estate settlement costs, and the number of years of household income your family would need to replace. On the resources side: existing life insurance including group coverage, savings and investments, and any survivor benefits.
The difference is your gap. Our calculator will run this in about two minutes, and we will talk through the answer rather than just handing you a number.
Choosing the term length
If two obligations have different horizons, laddering is often cheaper than buying one long policy for the whole amount: a larger 15-year policy for the child-rearing years stacked on a smaller 30-year policy for the mortgage. As each obligation ends, that layer of premium ends with it.
| Situation | Sensible term | Why |
|---|---|---|
| New 30-year mortgage | 30 years | Covers the obligation to its end |
| 15 years left on a mortgage | 15 or 20 years | Matches the debt, with margin |
| Newborn child | 20–25 years | Through school and into independence |
| Teenagers at home | 10–15 years | Through education and launch |
| Business loan with personal guarantee | Length of the loan | Retires with the debt |
| Income replacement to retirement | Years until you planned to stop | Coverage ends when earnings would have |
The conversion rider, and why it matters more than it seems
A conversion rider lets you convert some or all of your term policy into a permanent policy with the same carrier, without new medical underwriting, up to a stated age or a stated number of years into the term. When you buy the policy this feature costs little or nothing. If your health changes, it becomes the most valuable clause in the contract.
The scenario is common enough to plan for: you buy a 20-year term at 40, you are diagnosed with something at 52, and at 60 the term is running out and no carrier will issue you a new policy at any sensible price. If your policy is convertible, you convert. If it is not, you have nothing.
Not all conversion riders are equal. Some allow conversion to the carrier’s full permanent portfolio; some restrict you to one product. Some run the full term; some cut off at year ten or at age 65. We check this on every quote.
Underwriting: exam, accelerated, or none
If you are in good health, taking the exam is usually worth several hundred dollars a year for thirty years. If you have a condition, the right move is often to have us pre-shop your file informally with underwriters before a formal application goes on record — a declined application is visible to other carriers, so the first application should be to the carrier most likely to say yes.
- Fully underwritten — exam, labs, medical records. Slowest, and almost always the lowest price.
- Accelerated underwriting — no exam for healthy applicants within certain ages and face amounts, decided from data.
- Simplified issue — health questions only, no exam, higher price, lower face amounts.
- Guaranteed issue — no health questions, small face amounts, graded death benefit, highest cost per dollar.
Frequently asked questions
What happens when my term ends?
The level premium period ends and the policy typically becomes annually renewable at a sharply increasing rate, or it lapses. You can let it go if the obligation it covered has ended, convert it if the policy is convertible, or apply for a new policy — which requires underwriting at your current age and health.
Is term life a waste of money if I outlive it?
No more than car insurance is wasted in a year you do not crash. You bought a defined period of protection at a low price and the risk did not materialise, which is the outcome you were hoping for. What would be wasteful is buying permanent insurance you cannot sustain in order to avoid that feeling.
Do I still need coverage if I have life insurance at work?
Usually yes. Group life is typically one or two times salary, rarely enough on its own, and it almost always ends when the job ends — often at exactly the moment your health makes new coverage expensive. An individual policy you own is portable and priced at the age you bought it.
Are the death benefits taxable?
Life insurance death benefits are generally received income-tax-free by the beneficiary. Estate tax treatment is a separate question and depends on ownership of the policy and the size of the estate. We are not tax advisers — for large estates, this is a conversation to have with yours.
How fast can a policy be issued?
Accelerated underwriting can approve a healthy applicant in days. Fully underwritten cases with an exam and medical records typically take three to six weeks. If you have a deadline — a closing date, a divorce decree, a loan requirement — tell us up front and we will route the case accordingly.
How we help
The services that go with this.
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Indexed universal life (IUL)
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Final expense / burial insurance
A small permanent life policy — typically $5,000 to $35,000 — designed to cover a funeral, outstanding medical bills and the administrative costs of settling an estate, without leaving the bill to your family..
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Disability income insurance
Your ability to earn is the asset every other plan depends on, and it is the one most people never insure.
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