Affordable Life Insurance Protection for Your Family

Term Life Insurance IQ Test

Take a Term Life Insurance IQ Test and Find Out

How Much You Know About Term Life Insurance Coverage

How much do you really know about Term life insurance?

You may already know that helping to protect your family’s future with affordable term life insurance is an important step to take in a sound financial plan.

But do you know when you should buy, how much life insurance coverage you really need and other factors that may be important to your purchase of life insurance?

You can find out by taking our Term Life Insurance IQ Test.

It will only take a few minutes to answer some questions and when you’re finished you’ll know a whole lot more about how term life insurance works.

Term Life Insurance IQ Test

Term life insurance protects the policyholder for a specified period of time.

 A: True     B: False

The correct answer is true. When you buy a term life insurance policy, you get to decide how long your life insurance coverage will last., which is called the "term" of your policy.

Many people base their term length according to major events in life, such as when they will have their home mortgage paid off, when their children will finish college or move out on their own. Maybe you only need a term life policy for 10 years, or maybe you need it for 20 or 30 years.

The bottom line is, you get to decide how long your term life insurance policy will last. And, if you no longer need the coverage you can stop paying your premiums and the coverage will end.

Term life insurance coverage is guaranteed to last until you die.

A: True     B: False

The correct answer is false. A term life insurance plan may last for a term of up to 30 years, usually. Most plans offer you the option of choosing a term of 10, 15, 20, 25 or 30 years. Since you may outlive the "term" of your term life policy, coverage is not guaranteed to last until you die.


A good time to buy term life insurance or review your current term life policy to make sure the coverage amount is still enough is when you:

A: Have a baby
    B: Get married   C: Buy a house
    D: All of the above

The correct answer is D. Each of these life events should trigger a careful review of your life insurance needs.

Since term life insurance is meant to provide financial support in the event the policyholder dies, making sure that your policy provides enough coverage for your family’s current and future money needs is a major consideration.

Think of it this way: The term life insurance policy you bought years ago when you were single and living on macaroni and cheese in a rented apartment probably doesn’t cover you now that you’re married with two kids, a mortgage and a grown up job. As your financial responsibilities increase, so should the amount of life insurance you own.

Term life insurance proceeds are paid out free of Federal income tax.

A: True     B: False

This is true, under current tax laws. In the event of your death your term life insurance policy death benefits would be paid to your beneficiary without any federal income taxes.

However, be sure to consult with a qualified tax person or financial advisor before taking any action based on this information.

Level term life insurance rates are guaranteed to remain the same.

A: True     B: False

The correct answer is true. Rates for level term life insurance are guaranteed to remain the same each year for the duration of your term. So, if you have a 15-year term policy, the rate you pay will stay the same each year for 15 years.


You don’t need a term life insurance policy if you already have group life insurance through your employer.

A: True     B: False

The correct answer is false. Some employers offer group life insurance to their employees; however, it’s usually not enough to adequately protect you and your loved ones.

Also, if you get a new job, you can’t take your employer provided life insurance coverage with you, so it’s a good idea to have your own individual term life insurance policy in addition to your employer’s group plan. That way, you’ll have protection even if you lose your job.


Term life insurance is a "get it and forget it" type of purchase.

A: True     B: False

This is false. Buying a term life policy is a good first step, but you have to review your life insurance needs regularly to make sure the coverage amount is still enough to adequately protect your family in case you die.

If you tuck your policy away in a drawer somewhere and never review the coverage, you are putting your loved ones at risk of not having enough money to live on when you are no longer there to help support them, if you don’t maintain the right amount of life insurance coverage.


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