The 25 year term life insurance policy was here before the 30 year term insurance policy.
It falls neatly between the 20 year term policy and the 30 year term policy. This policy has a level death benefit and as well as a level premium.
Since this is term insurance the premium is fairly inexpensive. There is no cash value.
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Why Buy 25 Year Term Life Insurance?
- Young married people intending to have children in the near future could use this policy to take care of the financial needs of the family if a breadwinner dies. The needs of the family are not going to be any less because either husband or wife is not there…
The rent or mortgage still has to be paid, the amount spent on food will be about the same, everyone has to continue wearing clothing and the payment for the automobile still needs to be taken of…not to mention maintenance, gasoline etc…
It is going to cost money to bury the deceased spouse and parent. If they have a will, , and everyone should, it is going to cost money for probate and attorney’s fees. If the estate is large enough there will be estate taxes to be paid. In addition there is always something that we forget about when planning for this eventuality that we would need to take care of.
The 25 year term life policy can be set up to provide a monthly income instead of the usual lump sum. This makes sense if the amount of insurance is fairly large.
- Business people find many uses for the 25 year term life insurance policy. If the business is a partnership, s corporation, c corporation or a limited liability company this policy can be used to fund a buy-sell agreement in the event of the death of a partner or stock holder…
It can also be purchased on the life of a key employee to serve as a cushion in the event of this persons sudden death. As it usually takes time to replace such a person the company could suffer some loss. The 25 year term life insurance policy could replace some or all of that loss.
- If you purchase a house with a 25 year mortgage your family may lose this house if there is not sufficient income to make the payments. Although a decreasing term life insurance would be the preferred choice for most people some people buy the 25 year term life insurance policy to cover their mortgage.