Saturday, March 01, 2008

25 year family income and term insurance

When I was 30 years old, I bought a 25 year term insurance policy to cover a sum assured of $100,000 and to provide a monthly income of $2,000 to my family in the event of premature death during the term. I paid a premium of about $1,000 a year.

25 years have passed, and the policy has now expired. During this time, I was assured that, if anything had happened to me, my family would have a lump sum and monthly income to meet their financial needs. I have other life insruance policies, which provided additional coverage.

Term insurance was rather expensive in those early days. Today, the premuim rate for the same cover is much lower. It does not matter to me that I did not get any return for this term insurance policy, as I was able to accumulate and invest my savings in other ways.

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