You know you need term life insurance but you can’t decide on the death benefit amount or the length of term because you see the needs changing over time. You might be a good candidate for laddering or layering term life insurance policies.
As an example, we have a 45 year old married male with two children, ages 5 and 10. He has 10 years left to pay off his mortgage. Looking at his needs, we see his insurance needs as the following:
Typically, he might look at these options;
Here’s where layering can come in handy. I would recommend:
This would give him $2 million for the first 10 years, $1 million for the next 10 years and $500,000 for the next 10 years.
As you can see above, this would provide the right amount of coverage at the lowest possible premium. We don’t recommend this for everybody, but in the right situation, it saves the client money while giving him adequate coverage.
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To help you determine your needs, visit our life insurance calculator.
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