Term life bargains vanishing
The window might be quickly closing on consumers’ opportunity to refinance at great rates — not their home mortgages, but their term life insurance, experts say.
For the first time in a long time, premiums are on the rise.
Over the last several years, prices on simple term life insurance have been plummeting. Premiums in recent years could be less than half of what they were in the early 1990s. For example, the same policy that had an annual premium of $1,400 back then might have cost $350 last year.
The price drop represented easy savings for consumers, who could simply buy a new, lower-priced policy — even with the same insurer — and then cancel their old one.
That’s changing. Here’s what you need to know about term life insurance:
— The pressure is on low cost car insurance. Since the start of the year, insurance companies have started raising premiums for new policies — most often by 5 percent to 15 percent.
— Lock in now. Rising rates do not affect most term policies already in place because premiums are level, meaning they stay the same for the duration of the policy.
— Opt for longer terms. Consider buying a policy with a longer term, such as 20 or 30 years, to lock in today’s relatively low prices.
— Shop around. Premiums can vary widely for the exact same coverage.
Filed under: term by Pascal