What decreases in decreasing term insurance?
Insurance Disclosure A decreasing term life insurance policy is a specific policy type with a level of coverage (or death benefit) that decreases over time, usually every year. When a decreasing term policy is purchased, the death benefit decreases periodically until the end of the term.
What is the purpose of decreasing term insurance?
Decreasing term life insurance is often used to cover a specific debt, like a mortgage. For example, if you have a 30-year mortgage, you can buy a decreasing term life insurance policy to match the coverage amount and length of the mortgage. Each year, the payout and mortgage amount would decrease together.
What is one important element of decreasing term insurance?
What is one important element of Decreasing Term Insurance? The premiums decrease over time.
What is decreasing term insurance Why would someone purchase this type of life insurance quizlet?
Decreasing term insurance is often used to provide funds to pay off an outstanding loan in the event the insured dies before the loan has been fully repaid. The decreasing coverage can often track with the outstanding loan balance at a premium that remains level.