Maybe I just don’t understand what they’re doing. BUt it seems to me if I take out a 10 year policy that costs $100 per month, I’m betting that I’m going to die within that period of time and the company is betting that I won’t or that they won’t have to pay out. If I get to the end of that 10 year term, then I’m just out $12,000. What am I missing?
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If you’re taking out a term policy that costs that much, you should change insurance companies. My husband and I have twenty year term policies, and pay less for both. The point of a term policy is that it costs less, and covers a specified period of time – for example, right now is the “riskiest” time for one of us to die, because we have debt on our house, and kids. We have a policy that covers the riskiest time – by the time the policy expires, the kids will be out of the house, the mortgage will be paid off, and it will hurt far less financially if one of us dies.
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