Life insurance is one of the most important financial products a person can own. A good policy provides security for individuals and families in the event something unexpected happens – it also has some ancillary financial benefits (we’ll get to those!). However, for many, choosing the right policy for their family or individual situation can be an overwhelming process. We want to change that.
Life insurance policies generally fall into two buckets – permanent life insurance and term life insurance. And the primary difference between these two types of life insurance is the length of the coverage. A universal life policy (UL), which falls into the permanent life bucket, provides an unlimited length of coverage, as long as premiums are paid. A UL policy can also be customized to fit specific needs and may accrue cash value over time. Comparatively, term life insurance policies are often less expensive and cover you for a set amount of time, typically 10 to 30 years. These policies are also customizable, but there has been a clear coverage gap. That is, until now.
Based on the fact that Americans are working and carrying debt longer, having the ability to extend life insurance coverage beyond 30 years while keeping the price affordable seems obvious. Or at least it is to us! Legal & General America recently became the only carrier to offer a 40-year term product through our subsidiary Banner Life. We call it OPTerm 40.
Here are five reasons why you might consider getting an OPTerm 40 policy:
- Added security – As mentioned, traditional term life insurance lasts for 10 to 30 years. So if you buy a typical term life product in your 30s, 40s or even 50s, odds are you will outlive your coverage – especially since life expectancy in America is on the rise. At the same time, the average US worker is retiring later than ever before. A 2018 study found the retirement age to be projected at 66, compared to age 60 in the 1990s. A 40-year term life insurance policy offers a greater amount of security for those who anticipate working well into their 60s.
- Mortgage protection – For many, a home is a family’s most valuable asset. If your life insurance policy is at least the amount of the mortgage, your family can use the funds to cover the cost of the mortgage so this important asset can be protected.
- More choice – OPTerm 40 is customizable, meaning you have flexibility in terms of how your policy is constructed. For example, the amount of coverage you receive can differ depending on your existing financial obligations. This option can be particularly attractive for millennials and Gen Xers because it allows them to have affordable coverage into retirement while using those cost savings to help build a bigger nest egg or college fund for their children.
- Ample business benefits – For businesses, especially small and medium-sized companies, an affordable 40-year term option has its rewards. Buying key-man coverage provides security that a business will run as usual even if the business owner dies.
- Trustworthy – Choosing a 40-year term policy offered by a company with strong financial ratings means you can rest easy knowing that your insurer will be around to offer you the coverage your family needs, when you actually need it. The Legal & General America operating companies are among the most financially-sound life insurers. Our investment portfolio is conservatively positioned and prudently managed, and ranks consistently among the highest-rated by agencies like A.M. Best, Standard & Poor’s, Fitch and Comdex. If you choose us as a partner, we want you to know that you and your family are in good hands.
We are proud to be the only insurance provider to currently offer a 40-year term product in the U.S., providing a solution to a much-overlooked need in the marketplace. If OPTerm 40 sounds like something you, your family would benefit from, speak to your life insurance agent or contact us today.