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Let's cover some common insurance terms

If you haven’t had life insurance before, some of these terms might be new to you.

Here is a brief explanation of a few of the more common ones that you might come across during the process.

And as always, reach out with any questions.

Term” is in reference to how long your coverage will last for.

More specifically, it’s how long the premium is guaranteed to not increase.

Mos term insurance will allow you to “renew” the policy after the term has matured, but the premiums will increase dramatically, year after year.

The face amount is also known as the death benefit, or coverage amount.

This is the amount your beneficiaries will recieve after your passing.

This is the amount you pay to own the policy.

You can pay monthly, quarterly, semi-annually or annually.

Rating is based on your health.

Every insurance company may have their own lingo for each rating, but in essence, it’s all the same.

For example, the healthier you are, the higher the premium rating.

Beneficiary is who you designate to recieve the proceeds, or death benefit, of the policy after your passing.

This is the process you go through for the insurance company to determine if they will approve your application for insurance.

This is also when they determine the premium rating they’ll offer you.

Some insurance policies may offer a Waiver of Premium rider.

Most often, this rider kicks in when the premium payer becomes disabled.

After you accept the insurance company’s offer for life insurance, you’ll have a free-look provision.

During this time, you have the option of canceling your policy without penalty.

Depending on what state you live in, this can be at least 10 days long.

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