Thinking about life insurance isn’t exactly all that fun.
What policy do I choose? How long should I take it out for? What sort of riders should I add? These are all questions that come up when choosing a life insurance policy.
Luckily, the process has just gotten a little bit easier!
Banner Life Insurance has recently released a new 40-year term life insurance that can now provide life insurance coverage well into retirement years while all at an affordable fixed rate.
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Understanding Life Insurance
Before we get into Banner’s brand new 40-year term life insurance, let’s quickly cover the basics on what exactly life insurance is.
Put as simply as possible, life insurance is insurance that pays out a sum of money either when the death of the insured occurs, or in some cases, after a set period of time.
However, that’s not all there is to know about life insurance. It’s a little more complicated than that.
Life insurance isn’t just about assigning your life a monetary value – it’s also about making sure that your family and loved ones are able to deal with the financial obligations that come with the loss of life.
It helps cover things like funeral expenses, outstanding debt, lost income, etc.
So if you have anyone who relies on you financially (a spouse, kids, etc.), then you need life insurance to help protect them.
There are two “varieties” of life insurance that you should know about.
The first is permanent life insurance, which is exactly what it sounds like. It is a policy that will remain in effect until you die (as long as you make your premium payments). Most permanent life insurance also has a “cash value” option.
The cash value option basically means that you get a savings account that will grow over time which is based on an interest rate attached to the policy. It can be a nice feature to have as you can have cash available when you need it.
So with permanent life insurance, you take it out and as long as you pay your premiums you don’t have to think about it again.
The second kind of life insurance is term life insurance. It’s the simplest, least expensive, and most widely applicable. Basically, the policy premium is based on the probability that the insured will pass away within a stated term (10 years, 20 years, 30 years and now 40 years).
The premium is guaranteed to stay the same for the entire duration of the policy and when it runs out you either renew it or let the policy lapse if your life insurance needs have been fulfilled.
So now that you understand what life insurance is, let’s get to the good stuff.
Banner's 40 Year Term Life Insurance
A 40-year term life insurance policy is a new and exciting product in the life insurance industry. A 40 year fixed premium contract is significantly out of the norm for term life insurance.
You will find that most companies who offer term life insurance will have a maximum policy of 30 years.
Up until Banner announced their 40-year contract, AIG, who is another great (A) rated company, offered the longest option of 35 years and still does to this day.
What really makes this a big deal is that up until this point if you wanted coverage to last over 30 years, your only real option would be to purchase a permanent life insurance policy.
The problem with permanent insurance is that it can cost over double that of term life insurance. Because of the big jump in cost between term and permanent is not always a budget-friendly option for all families.
But not anymore!
Banner has solved that problem with the introduction of its 40-year term life insurance policy which has been added to their popular term life insurance line called OPTerm.
With the 40-year term life insurance policy you’re locked into the premium rate you start with no matter what health complications you may possibly end up facing later in life.
With Banner currently being the only company to offer such a policy, you’re guaranteed to have a death benefit that will pay out to your beneficiaries if you pass away within 40 years of having the life insurance policy.
Another great feature included with the coverage at no extra costs is that it has a guaranteed conversion option. The conversion option allows for the coverage to be converted into permanent life insurance without having to prove insurability, as long as it is done prior to age 70.
A conversion option is a great benefit to have especially if life insurance needs change to where they become more permanent. They become especially handy if you become ill with an illness that would prevent you from getting new life insurance coverage.
While premiums are more expensive for a longer term duration than let’s say a 10 year, can you really put a price on peace of mind?
Banner OPTerm Life Insurance
Overall Issue Ages: 20-75
- OPTerm 10 Year: 20-75
- OPTerm 15 Year: 20-75
- OPTerm 20 Year: 20-70
- OPTerm 30 Year: 20-55
- OPTerm 35 Year: 20-50
- OPTerm 40 Year: 20-45
Minimum Coverage: $100,000
Maximum Coverage: $10,000,000+
Conversion Options: Yes. Coverage can be converted into permanent insurance up to age 70.
Optional Policy Riders:
- Accelerated Death Benefit: If diagnosed with a qualifying terminal illness, this rider can payout the lesser of $500,000 or 75% of the death benefit in advance. (No Extra Cost)
- Children’s Term Rider: Provides level death benefit on all children of the insured up to age 25. The minimum death benefit is $5,000 up to a maximum of $20,000 if both parents have or are applying for coverage. Coverage expires at the child’s 25th birthday but can be converted into permanent insurance as long as it is done within 31 days following the expiration of the rider. (Extra Cost) (Not available in MD & NY)
- Term Riders: In addition to the base coverage, this rider provides additional term insurance coverage for a specified amount of year such as 10, 15 or 20 years. Basically, it allows you to ladder your life insurance needs by purchasing a longer term length such as a 30, 35 or 40-year plan as your base policy and then adding shorter term lengths to cover short term needs. The riders will automatically fall off when they have reached the end of their term durations. (Extra Cost)
- Waiver of Premium: This rider will waive all premiums up to age 65 due to total disability that has occurred while the coverage has been active and that has continuously existed for at least 6 months. (Extra Cost)
Is it available in a No Medical Exam Option?
For applicants who are truly looking for a no medical exam life insurance option, we will admit that Banner is not our first choice.
The company does offer an accelerated underwriting option that will allow for some applicants to bypass the entire medical exam process if they meet specific underwriting requirements.
At Top Quote Life Insurance we can generally get a feel as to whether or not an applicant may be eligible for the accelerated underwriting process based on some simple questions.
The process for accelerated underwriting does require a telephone interview that is generally 45 minutes long. The program is limited to applicants between the ages of 20-40 for up to $1,000,000 and ages 20-50 up to $500,000.
The benefits of qualifying can result in getting approved for coverage very quickly.
We just ask that applicants be open to a medical exam if considering Banner Life Insurance as you may be asked to take one if you do not meet the accelerated underwriting guidelines. If you are not eligible for the program you will be notified during the interview and have the option to schedule an exam at that time.
40 Year Term Life Insurance Sample Rates
Age $100,000 $250,000 $500,000 $750,000 $1,000,000 20 $17.01 $25.23 $42.80 $61.62 $71.97 25 $17.01 $25.23 $42.80 $61.62 $71.97 30 $19.24 $28.67 $52.18 $75.69 $102.57 35 $20.21 $34.83 $64.49 $94.16 $135.94 40 $27.73 $61.58 $114.14 $168.63 $222.63 45 $41.93 $97.08 $188.99 $280.91 $370.06 Age $100,000 $250,000 $500,000 $750,000 $1,000,000 20 $15.52 $20.58 $33.98 $48.39 $57.12 25 $15.52 $20.25 $33.98 $48.39 $57.12 30 $15.82 $22.61 $38.48 $55.13 $72.63 35 $17.58 $28.95 $52.74 $76.53 $93.12 40 $23.27 $48.96 $91.26 $134.31 $176.84 45 $34.18 $77.71 $145.15 $215.14 $288.87
Who Should Get 40 Year Term Life Insurance?
Keeping in mind that the age cutoff for the 40-year term option is 45, this coverage is truly ideal for younger families that may have small children and a high need for life insurance coverage.
Best of all, it’s term insurance so it will be very budget friendly compared to a permanent policy.
Another great benefit of the 40-year term life insurance policy is that you’re locking in your rates for the next 40 years while doing it at a young age. You know what they say when it comes to buying life insurance, “buy it while you’re young as it only gets more expensive as you get older”.
Along with locking in rates, you can rest assured knowing that if you have a change of health later in life, you have the option to convert to permanent coverage.
A few other great reasons to consider the 40-year term option:
- Great option to have especially with having a mortgage
- Can provide coverage well into retirement and senior years
- A very affordable alternative to permanent life insurance
A Banner life insurance policy may be the last one you ever have to buy! So it’s a one-stop shop to ensure you don’t have to think about your life insurance again for a very long time – maybe ever.
Potential Cons of 40 Year Term Life Insurance
While the 40-year term life insurance policy may seem like a great idea, it is worth noting some small but potential cons of the policy as well.
As affordable as term life insurance is because it’s a longer duration, premiums are going to be much higher than other (shorter) policies.
There's No Competition
One of the drawbacks is that there is currently no other life insurance provider offering a 40-year term life insurance option other than Banner.
So you don’t know if you’re truly getting the best price you could. Sure, it’s the best price on the market because it’s the only one. This is not necessarily a bad thing but there is no other company to compare the rates too.
There Are Age Restrictions
Put simply, there are age restrictions. You can only purchase the Banner 40 years term life insurance policy if you’re between the ages of 20 and 45. So if you’re above the age of 45 you will not qualify and you’ll have to consider a shorter duration of term.
Again, this not a bad thing as there are other companies who will offer longer-term duration to older applicants. For example, Transamerica, who is another (A) rated company offers their 30-year term option to applicants up to age 58.
Limited Policy Riders
Banner offers a few of the more common policy riders that can be added to the life insurance coverage. The rider that allows you to ladder coverage called the “Term Riders” is one of the more unique offerings from Banner but that is really about it.
If you’re looking for something such as a term life insurance policy with living benefits that can payout out a benefit due to a chronic or critical illness, you will need to consider another company. At this time Banner only offers the terminal illness option which is available with most companies at no extra charge.
Conversion Can Be Expensive
If you decide later on that you want to convert your 40-year term life insurance policy to permanent insurance then it’s going to be expensive. Banner’s permanent insurance option is a bit more expensive when compared to other similar products on the market.
And while you could always try to go with another company at that point… It might not be so good when you consider the health risks and complications that could arise over the course of 40 years.
It's Not Permanent Coverage
People are living longer these days, so there is a very good chance that you will outlive your term life insurance contract. Even if you purchase a 40-year term duration at age 45 that will provide coverage up to age 85.
Most people do not need a significant amount of life insurance at that age so again this is not a bad thing. Just consider stacking your term life insurance coverage with a smaller final expense or burial policy which can be done later down the road. Just remember, the younger you are the cheaper it will be.
As you can see, the cons of purchasing a 40-year term life insurance are very minor when compared to the benefits.
A Little About Banner Life Insurance
Banner Life Insurance Company does business under its parent company Legal & General America when it comes to life insurance policies.
Banner Life Insurance Company also works with William Penn Life Insurance Company of New York to underwrite and issue life insurance policies under the Legal & General America brand for policies issued in the state of New York.
Banner Life Insurance Company Ratings
Banner Life Insurance Company is highly rated and receives the following scores:
- A.M. Best: A+ (Superior)
- S&P: AA- (Very Strong)
- Fitch: AA- (Very Strong)
From these ratings, we know that Banner Life Insurance company and its subsidiaries do good business and are financially stable enough that they can be expected to be around long enough to actually pay out your policy.
This is especially important with a 40-year term life insurance policy because it’s a long time to wait for a payout. You want to make sure that your beneficiaries are going to receive your benefit when you pick a company to purchase life insurance from.
All in all, Banner is a highly rated and highly trusted company, which makes it a great option for purchasing your life insurance policy.
Have Questions or Need a Quote?
Still not sure if the 40-year term life insurance policy is the best thing for you? Or maybe you’ve still got questions or would like to see some rates? Don’t worry! We’re here to help.
Please, reach out to us for more information about this coverage or about life insurance policies in general as we would love to help assist you.