5 Reasons You Should Take Out Level Term Life Insurance

Looking to leap ahead of a risk that lasts for a defined period? Level term life insurance can offer you the right cover for those kinds of needs. With this policy, you acquire financial security over the demanding phases of your life, career, or family.

For example, a dad determined to put his kids through school can take a policy that steps in to cover education expenses in his sudden departure or incapacitation.

There are many other reasons you may want an insurance plan that lasts for a predetermined period. Luckily today’s article explains the 5 top benefits of taking out a level term life insurance plan.

Why take out level term life insurance?

Offers a predetermined fixed payout

When applying for level term life insurance, it’s you to decide how long your insurance plan lasts. Besides, you agree with the insurer on the pay-out amount that your beneficiaries will get if the risk occurs within the policy’s life.

The nature of this type of life insurance allows you to plan for your future more reasonably. With the help of your insurer, you can calculate how much financial risk lies ahead if you pass away. This helps to guide on the suitable insurance plan to take out to cover this risk sufficiently.

Additionally, the fixed payout can be helpful for needs whose financial value remains constant for a known period. For example, some loans demand repayment of a fixed fee at a set date. If you’re incapacitated or pass away expectedly before that time, your insurer will repay it on your behalf.

Plans have a known expiry date

There are financial needs that exist in a particular phase of our lives and which must be met even in our absence. Luckily, level term life insurance offers a backup plan through plans that remain valid for a predetermined period.

Whether you outlive your policy or not, you’re guaranteed of achieving your goal. In short, this type of life insurance offers a win-win result at the end of an important life goal.

Compatible with other forms of life insurance

Sometimes you have situations that present multiple financial risks. To minimize possible losses, you decide to apply for several life insurance policies. If the risk occurs, your insurer offers financial support to help you or your beneficiaries to recover and cope.

Luckily, level term life insurance plans are compatible with other forms of insurance. For example, a soldier can take out a policy to support his family if he passes away at war and another to take care of recurring bills if he falls critically ill or gets incapacitated by an injury. This way, he takes care of both risks, safeguarding his future as well as that of his beloveds.

Pays the insurance benefits once

Standard level term life insurance policies issue the agreed-upon financial support once in form of a lump sum.

This kind of payment is particularly helpful in situations where the occurrence of risk results in huge financial implications. An appropriate level term life insurance cover then enables your beneficiaries to take care of the situation without delay.

For example, a couple where only one partner works can benefit largely on a first-death basis joint level term life insurance plan. Regardless of who dies first, the death benefits will help the surviving partner cope better with the loss.

Policies have variable costs

Another advantage of level term life insurance is that policies have variable costs. Put simply, your insurance provider will charge you monthly premiums that align with your level of risk.

For example, consider a smoker and non-smoker who enroll in a policy with similar death benefits. The former will potentially pay higher premiums than the latter where the risk covered is death or a predetermined terminal illness.

Of course, several other factors come into play when your insurance provider is calculating the cost of your premiums. Nevertheless, the top determinants are age, lifestyle, and other circumstances that influence the risk levels of policyholders.


Level term insurance remains to be one of the most popular forms of life policies today and it’s easy to see why. The biggest benefit of taking out this plan is that you’re in control of how much risk you want covered and for how long.

Are you thinking of purchasing this cover? Please let us know if you have any questions or feedback.

Atif Mallo

Atif Mallo is a freelance blogger with huge interest in technology, science, life hacks and health. He loves coffee, cheesecake and chess. Drop a line in comments to leave feedback for him.

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