10 Term Life Insurance Questions and Answers

Common Term Life Insurance Questions &

Answers

Can the life insurance company cancel the policy for any reason?

Other than non payment of your premium, life insurance policies are generally “non cancellable”. This means that the life

insurance company can’t cancel your policy.

Are there situations where the life insurance company wouldn’t pay the death benefit?

Most policies do have some clauses for non payment. As an example, if you commit suicide in the first 2

years, die while committing a crime, or make a “material misstatement” on your application, your

death benefit may be denied. A material misstatement is knowingly lying on your application.

Is my policy renewable at the end of the term?

Most term policies are “guaranteed renewable”. This means that you can continue the policy at the end of the term without having to qualify by having a health

exam.

Does a term policy provide “living benefits”

There are term riders that do provide living benefits. For example, included in most term life policies is a “terminal illness rider” which allows you to access a portion of the death benefit while you are alive if you

become terminally ill.

Can I increase the term length of my policy in the future?

While you can’t increase the term (for if you have a 20 year term, you can’t increase it to a 30 year term), you may be able to convert a term policy to a permanent

universal life or whole life policy.

Can I cancel my policy in the future?

Yes. You can cancel a term life insurance policy at anytime without a penalty.

How will my family be taxed on the life insurance death benefit they receive?

Based on the current tax law, life insurance proceeds are income tax free.

What happens if I miss a premium payment?

Most companies will send you a letter if you miss a premium payment and will give you a grace period to make up the payment before cancelling your policy.

What is the process for my family to file a claim?

Your family can call your agent or the insurance company directly. They will have to submit a copy of

the death certificate. Most companies process payment right away and mail out a check.

Can I change my beneficiary at anytime, and how do I do it?

As the owner of the policy, you can change beneficiaries at anytime. You would fill out a form and

email, fax, or send it to the life insurance company.

To learn more about life insurance or to get a free quote, visit BestLifeQuote.com or call 800-574-0245