A short term life insurance policy refers to a term of 5 years or less while meeting the customer’s requirements for life insurance. It is meant to cover you for a short period of time and is mainly used has a specific purpose. The death benefit of a short term life insurance plan can help college tuition fees, off-set medical expenses, funeral costs, or loan repayments.
So, what is a short term insurance plan or why would you even consider having one? Be it as a single, stand-alone temporary policy, or as an additional layer of coverage to your existing life insurance, short term life insurance policy is a good choice. Given below are some situations that may warrant a short term life insurance plan:
- When you are travelling and need to have an additional layer of coverage.
- When you are exposed to a dangerous situation or a mishap.
- In order to provide coverage for a short-term loan or business transaction.
- When it is more important for you to have a greater amount of life insurance for the short-term. Take for example, if you are carrying a mortgage or other short-term debts.
- When you’re young and on a budget and all you want is a basic, affordable policy for now until you can upgrade to a more comprehensive one later.
It is always better to consult an expert before opting an insurance policy because while most people have a need for long-term life insurance protection, others at some point may need short-term life insurance coverage to help with a specific need. So, instead of jumping into any conclusion, it is always better to weigh your options to your specific needs. Some people may worry about the fact that these insurance plans are for a short span and once they expire you’ll have to reapply for another type of life insurance policy. Well, the best part is that short term life insurance policies are typically affordable, so they work well as a way to get started with life insurance.
If someone wants to get a clear idea as to what is a short term insurance plan, short term insurance policies are not as common as long term ones but you still can have one. It can take some time to get approved and get the policy set up. You can start by talking to insurance companies about what type of short term policies they can offer, and then compare. You’ll have to ensure that the policy you choose can offer a decent death benefit at affordable prices.
However, it is important to note that not everyone qualifies for life insurance. There are lifestyle factors that can drastically affect your premiums, even for a short term policy. Many life insurances for that matter require an in-depth medical exam, which insurance companies use to assess the level of risk associated. The best way to turn this into your favour is to adopt healthy lifestyle habits. By doing so, you can drive your premiums down significantly. Eating healthy and exercising regularly can also help you get in better shape and improve the results that you get on your medical exam. But along with everything else you must also realise that a short term life insurance policy shouldn’t be the only one you ever buy. You don’t want your policy to expire and be left without a life insurance. If you pass away without life insurance, you could leave your family with high funeral costs, as well as any debts that you might still owe. When you take out a short term life insurance policy, it’s important to think about how you’ll keep your coverage going once it expires.
When people ask what is a short term insurance plan, the best answer in short would be that a short term life insurance is an ideal level of protection when you’re searching for a low cost policy. The coverage amount can vary based on the policy holder’s financial needs and premium payment, making it a flexible way of providing coverage for a short period of time.
A short term life insurance will provide financial coverage for costs like funeral expenses, medical costs, education funds, mortgage payments, and other costs like any other insurance policies. This can help to ensure your family doesn’t have to face the added burden of financial pressures on top of the grief over your loss. As one of the many viable options in life insurance today, short term life quotes can help you overcome the uncertainty that your family may face if the unforeseen happens.
It is essential to understand the different instruments of term policies before one goes ahead with a single plan. For those wondering, what is a short term insurance plan, this is a must read.
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Aarvi the owner and senior content publisher at Financeclap. Aarvi completed his education in BBA (Bachelor of Business Administration), and recently she was working as an assistant manager for the accounts company. She also works as a senior digital marketing consultant for one IT company in 2018. The main idea for starting Financeclap is to provide the best and helpful information related to the business industry to the readers. Aarvi main hobbies are playing cricket, watching videos and listening to music in the free time. You can learn more about her on about us page.