Typically, all we know about is the old type of term policy. The old term policy will only pay out to your family upon death and there is about a 2% chance of you passing away during the term period. What about the higher percentage of you incurring a critical, chronic or terminal illness during your term period? What would happen if you could no longer earn an income due to a medical condition?
This is where the new term policy beats the old term policy every day of the week! The new term policy has living benefits, which cover critical, chronic and terminal illness. There is roughly a 70% chance of one of the three occurring during your term period. This new term policy is essential to protecting you and your family during your working years. Imagine if you were no longer able to earn an income and had an old term policy without living benefits. What would you do to provide for your family?
For example, a term policy with living benefits, which I commonly use for individuals and families, will allow you to use up to 90% of the policy face amount if you incurred a critical illness, up to 24% of the policy face value annually if you incurred a chronic illness requiring assistance and 100% of the policy face value if you were deemed to have 12 months or less to live all while you are still living! This is huge and much more beneficial than a standard old term policy.
I know what you are thinking, this must be more expensive. You thought wrong. In most cases, I have seen the new term with living benefits be equal to or cheaper than an old-style term policy.
Wouldn’t it make more sense to have better protection and benefits for your family?
