Term Life Insurance

Full Definition

Term life insurance provides a death benefit for a specified term — 10, 15, 20, or 30 years — and pays nothing if the insured survives the term. Term premiums are the lowest of any life insurance product because there is no cash-value component and most policies expire without claim. Term is typically sold to 25–55-year-olds for income replacement, mortgage protection, or to cover children's college costs. Underwriting ranges from fully-underwritten (with paramedical exam) to accelerated underwriting (algorithmic, no exam) to simplified-issue term for higher premium cost. FYC commissions are low (30–75% on smaller face, 40–90% on mid-market) but volume can be high because acquisition cost is low and close rates are 10–20% on real-time term leads.

Example

A 38-year-old with a $400,000 mortgage buys a $500,000 20-year term policy at $28/month. Agent earns 75% FYC on $336 annual premium = $252. Term is often a loss-leader into IUL or whole life upsell.

Related Terms

• Whole Life Insurance — Permanent life insurance with fixed premiums, guaranteed cash value growth, and a guaranteed death benefit — the product behind most Final Expense sales.
• IUL (Indexed Universal Life) — A permanent life insurance product with flexible premiums and cash value growth tied to a market index (e.g., S&P 500) with a floor and a cap.

Where This Applies on InsureLeads

• Medicare Leads
• Final Expense Leads
• ACA / Health Leads
• IUL Leads