Increasing Term Life Insurance

An increasing term is a term life insurance that guarantees increase of your death benefit as your age increases. The death benefit increases in a predetermined rate and it stops once reaches the limited amount.

What is increasing term life insurance?

Increasing term life insurance is the type of term life insurance by which death benefits increase over time, typically yearly or after a some years. While Premiums may or may not increase over time.

Since the death benefit increases over time, it might be expensive than level term life insurance. 

Increasing term life insurance is designed to protect death benefits against rising of living costs since it's death benefits increase alongside the inflation.

Cash value

This is an amount that is generated alongside your policy in which you can withdraw, take a loan or use it to pay your premiums.

Like any other type of term life insurance, increasing term doesn't guarantee cash values. If you are looking for the policy that guarantees cash values you should consider a permanent life insurance policy.

Premiums

This is a fee you should pay for your policy.

In increasing term, premiums may or may    not increase over time, depending on a policy provider.

Death benefit

This is an amount received by your beneficiaries once you die.

In increasing term, death benefits rise over time typically, each year or after some years. The increase of  death benefits could be in percentage like 5% each year or in flat rate like $20000 after 5 years.

Coverage length

Increasing term life insurance covers specific period of time, usually ranges from 10 to 30 years.

How it works

Once you purchase an increasing term the insurance company guarantees you death benefit that increases over time. If you die at the beginning of a term, your beneficiaries will receive lower amount than when you die at the end of the term. 

Usually, the death benefit stops to increase once reaches the limit.

Conclusion: An increasing term is suitable for those who want to protect the death benefits from inflations.