People mistake the word insurance for a service related to long-life commitment, and it is not always the case. Short Term Life Insurance policy is a plan that has the special characteristic of lasting less than one year and, generally, being acquired by people through a transitioning moment in their lives. It is highly popular due to its very low premiums and non-exigent requirements.
People who are looking at covering short-term financial agreements, such as loans, will find this type of insurance particularly useful.
There are multiple cases of needing short-term life insurance policy, with the most common being when you're in between coverage. If you're looking at being covered between policies or if you simply want a short-term life insurance quote whilst you negotiate a complex long-term option, a shorter policy could help provide you with some peace of mind.
Sometimes people will also be given life insurance benefits with their jobs - if you were to be made redundant, you'll lose your cover. Before finding a new role (which may or may not have a policy attached), it makes sense to only cover yourself with short-term life insurance policy.
The other most common usage is to cover yourself whilst going on holiday or visiting a hazardous country or location which your existing life insurance provider will not cover for. A lot of adventures happen in dangerous countries, you might want to look at short-term life insurance policies before travelling.
|Type||Short Term||Long Term|
|Length||1 - 12 months||Over a year|
|Cover||Limited - usually only basic coverage due to riskier situation||Considerably higher coverage, both in payout and scenarios|
|Cost||High premiums due to short nature||Lower premiums paid over a longer time|
|Flexibility||Very rigid, with little give on policy options||Far more flexible, giving a huge array of options|
|Overall||Expensive, but extremely useful in certain use cases||More cost effective, but is a far longer commitment|
Most short-term life insurance policies will sit somewhere between 1 day, to 1 year. It's rare to see any longer than 1 year, and they usually sit within the 2-4 week length amount.
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We reviewed some of the main aspects of short-term policies as well as compared it to the long term. If you found this information helpful or planning to travel somewhere, take a free quote below.