With this type of policy, you are guaranteed that either your beneficiary will receive the death benefit or that you will receive your premiums back. Oftentimes, these plans are marketed to those who believe that term life insurance is the best type of coverage to own, yet don’t want to take the chance that they will pay premiums into the plan for years without any type of return should they outlive the term of the policy.

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When an individual purchases a term life insurance policy, the coverage will typically range from between 5 and 30 years. The premium that is due for this coverage is based on the insured’s age and health status at the time that he or she applies for the policy.

If the insured were to pass away during the time that the policy is in force, the named beneficiary (or beneficiaries) will receive the death benefit proceeds. If, however, the insured remains alive past the policy’s stated time frame, or term, then the coverage will expire. In this case, there are many insureds who feel that they will have “wasted” their premium dollars.

In fact, one of the most common reasons people won’t buy another insurance policy is because they paid for the first one, and when the term was over, they thought about all the money they could have “saved” by not having an insurance plan in place.

Even if you don’t have to use your life insurance policy, you still need to have one.