Term life insurance can be purchased for a specified number of years, and provides a death benefit only if the insured person dies during that term. If the insured person lives past the term of insurance or stops paying premiums at any point during the term, the policy lapses and has no value. Term life insurance is one of the best options in a low cost insurance policy.

Term life insurance has budget-friendly options, and premiums are generally much cheaper than for cash-value policies like whole life or universal. Since in term insurance you pay only for life insurance coverage, it is the cheapest form of coverage for a limited number of years, especially when you're young. It is particularly suitable for younger parents who want to have substantial insurance coverage at low cost.

There are certain advantages of a term life insurance policy. It is flexible in nature, which lets many people buy term insurance to cover a temporary need with a fixed time horizon, such as raising children, covering education costs, guaranteeing a business buy/sell agreement or paying off a mortgage. Secondly, term premiums are very affordable. A person who is young and healthy can get a very good term life insurance policy at a very low cost. Another advantage is that you can convert term life insurance into a permanent policy without the need for proof of insurability or a medical exam.

There are different types of term policies available. In Level Term Policies, the protection remains constant, as do the premiums during the entire length of the term. In level term you can opt for guaranteed and non-guaranteed term policies. Another type is an ART or Annual Renewable Term policy, which offers level coverage and a level premium for one year. In this, the premium increases at the end of each year while the coverage remains constant. You can select the best policy that suits your requirements.