The Benefits of Buying A Term Life Policy Early

Not sure when the optimal time to buy life insurance is? Many people think they’re too young to worry about buying term life insurance, especially in the face of other, more immediate debts like credit cards and car payments. But the younger you are when you invest in term life insurance, the cheaper it will be.

Buying life insurance when you’re young can save you thousands. Because life insurance is age-banded, term life insurance cost more with each year that passes. However, the socioeconomic landscape has shifted, with millennials either remaining single or delaying marriage for longer than older generations, as well as carrying more debt with less income than their parents. Although it is important to prioritize paying off current debts, putting off buying life insurance can have a considerable financial impact similar to delaying saving for retirement. Here are a couple quick facts that reflect this trend:

• The ideal age to purchase life insurance is under 35, but very few people in this age group are able to afford life insurance

• About 57 percent of Americans own a life insurance policy, and over half of them are age 45 or older

While there are countless factors that go into determining term life insurance premiums, age is one of the most critical, so the sooner you make the investment, the more you’ll save. This may seem somewhat like common sense, but let’s take a look at why buying term life insurance early is a smart move.

Life insurance companies earn their revenue based on the premiums they collect from each client less any death benefits paid out. Therefore, their most critical imperative is to reduce the likelihood that they will have to pay an early death benefit in any policy that they approve. This basically means that your life insurance company is interested in you living as long as possible!

This is even more important if you’re considering purchasing a term life insurance policy. Because term life insurance policies have limited time periods (typically 10, 15, 20 or 30 years), life insurance companies obviously prefer that you do not pass away prior to the term ending. In this case, a death benefit will not be paid out and the premiums collected mostly represent profit to the company.

For this reason, age, as we mentioned, is of critical importance, and is why it is a key component in determining whether or not a policy is approved, and at what rate. Bottom line: the younger you are when you apply for a term life insurance policy, the less likely it is that a life insurance company will ever have to pay a claim. It’s as simple as that!

Ready to buy a term life insurance policy? Wondering about term life insurance cost? Schuler Insurance offers affordable, fixed duration, convertible term life insurance policies for 10, 15, 20 or 30 years with level premiums and optional child riders.

Schuler Insurance is a Texas life insurance company that has proudly been protecting families and their assets in Allen, Plano, McKinney, Frisco and the greater Dallas area for over a decade. Check our FAQs section for more information, compare term life insurance quotes today to find out how much life insurance you need and contact us today to find out how we can best serve you and your unique needs today.