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Simplifed or Traditional Term Life Insurance Policy? Here's Your Answer

Friday, June 5, 2015

Of late, Simplified Term Life policy has gotten much hype. No doubt that internet has played the pipe for it. Google takes you here, google takes you there. You must have come across the phrase in between and wondered about it. You are likely to have gone through the idea even. That’s delicious. Or, is that?
Let’s check. 

Chaffing the Grain
What is in the name? A rose a rose. But it is not always true ---the attitude. 
But when it comes to paying from your pocket for insurance, name matters most. Name is priceless, invaluable. It is the character here.  It matters for beneficiary. It matters for the policy that you buy. Name is the thing- the product. 
What Is It?
Nothing else than a Term Life Insurance Policy. The content is the same. The process is what makes it simple. Hence they name it Simplified Term Life Insurance. As such, you are covered for over a period of 10 to 20 years which is extendable, from mostly 80 years to 121 years of age. This varies from company to company. Your coverage typically starts from $$10,000 to $$100,000 or even more. It may also be convertible to permanent. 

The Mind Game Behind
It is good that insurance giants are coming up with newer policies for your benefit. Simplified Insurance Term Policy is, as I already have alluded to, such one. This has made Term Life Insurance Policy 'literally'literally hassle-free. Many a man does not want to go through medical check-ups, produce tons of documents or sign on them for their term life policy as there is no cash-value like in the perm insurance. This policy is for them. Insurers have designed this policy specially for you.  

It can be very well likened to filling forms for online surveys. Yes, it is that easy!  You simply answer to a couple of questions regarding your health conditions, driving records etc you are done.
Easier Sounded than Meant

Although you are likely to see ads telling you you are clicks away from your awaited insurance policy, it may not be that easy to sign up. You may not qualify for the policy if you are not found eligible. The first thing that may make you ineligible is your age. For example, NYL considers applicants between the age-range 30 and 74. Similarly, if you have had fatal health issues like HIV, AIDs,  mental impairment history that has affected you work-capability, or kidney diseases you are not to be enrolled on this policy. 

What If You Tell a Lie
You might think the information that you provide them is what they base on. Wrong. They will get your information checked on their own. It will range from medication history, driving to multiple simultaneous insurance policy-holding. You are mostly likely to get caught if you lie. You may be sued for fraud by the state in such case.  

The Premium Issue
Despite ads that you have affordable insurance policy for simplified term life, the fact remains that you are going to have larger premiums for it than that of a traditional Term Life Policy. As the insurer does not have direct knowledge of you (despite checks) beyond what you provide them, your naturally pay for the risk they take for you.

So Finally,........Traditional or Simplified?

When everything in life situation is complicated, you may have found the simplified term policy worth it. But don't just rush for it. Simple is not always simple. You need to give it thoughts before you proceed.
 Yes, why would you pay more for decades for a few hours’ of hassle? And aren’t they screening you behind the scene? Why would you take the risk of being sued for fraud, aware or unaware? Besides, you have less add-ons here than those on your traditional life insurance policy. 

Better? Yes, the traditional is always better. It is good to go through some hassle--- to talk things through.  You have your answers. You know what you are doing. You have your choices to make. So take a turtle-step instead of haring into your policy off-hand. It is wise not to be led to accepting the simplified prima facie. After all, it is an insurance policy.

Image Courtesy: centraloreqoninsurance.com

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