Types of Term Life Insurance

Level Term

Level term life insurance is a policy where the premiums and the death benefit stay the same for the entire length of the term. Once you lock in your rates they remain level for the life of the term.

Annual Renewable Term

In a annual renewable term policy the premiums start out low and increase each year. Rarely the best option for a term policy. Nobody likes to see an annual increase in their insurance rates.

Common Level Term Lengths

A five year level term insurance policy is for short term obligations. A ten year term is typically cheaper than a five year policy. Very few term insurance companies offer a 5 year term policy.

How much term life insurance do I need?



The D stands for debt. This would be any outstanding debts, minus the mortgage. Like credit cards, personal loans, car loans, student loans, business loans, etc. Having money to eliminate any outstanding debts will give your surviving loved ones a much better chance for financial success.


The I stands for income. Typically people will want to replace income for at least 10 years if they were to die. Botley Life Agents personally recommends replacing income for 20 years if possible. If your family depends on your paycheck then you want to make sure you replace it.


The M stands for the mortgage. If you don’t take out enough insurance to replace income. At least take out enough to pay off your mortgage. Being able to pay other bills will be much easier on your loved ones if you no longer have a mortgage to pay.


The E stands for education. This could be private school or college education costs you may want to provide for your children. College cost is on the rise, so over estimating the cost is wise. Education is directly tied to your children’s future success.