Term Life Insurance is a basic policy that pays out a lump sum benefit if you die. You buy this type of policy to protect your loved one or your business in case you die owing lots of money. Many people take out this policy when borrowing money to purchase a home. In case of death the mortgage is paid out in full which leaves less of a financial burden on your family.
Term Life insurance is becoming more affordable for everyone as insurance companies and banks worldwide seek to increase their market share. Since 1990, premium rates have fallen by an average of 30 percent and in some cases by up to 50 per cent.
When you take into consideration inflation trends, the cost of insuring your business partner or loved one is even cheaper.
Life Insurers in western countries began slashing their term life rates in the face of rising consumer awareness earlier this decade. It will be only a matter of time before the Hong Kong and other markets in Asia are forced to do the same.
There is no investment attached to this policy and you don't receive any money back if you survive the term of the policy. You can, however, combine Term Life with other types of insurance such as Trauma and Income Protection insurance to ensure complete financial confidence when you and your family need it most.
You can work out how much term life you need as follows.
First, determine the cash needed each year, and for how long.
Next, choose the net earning rate (less inflation), then the factor that corresponds with the net earning rate and the number of years required.
Finally, multiply the annual income identified in step one by this factor for the capital sum required.
Too confusing? Don't worry, just complete our quotation form and we'll do the calculations for you!
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