Most term life insurance policies don’t go up in cost every year. One type that does is an “annually renewable” term life insurance policy. The premium in an annually renewable policy starts out inexpensive (usually less than a level premium policy), but then the premium goes up every year as you age. And, the longer the term, the more expensive the premium becomes.
That said, we don’t sell that kind of policy.
If you want life insurance for 10 years or more, we recommend you choose a policy with guaranteed level premiums. This ensures the premiums remain the same regardless of your age and reduces the risk of you not being able to afford your premium later on. With level premiums, the guaranteed premium rate is locked-in for the term length of the policy.
To think of it comparatively, annual term insurance is a bit like signing a year contract with a cable company and once you hit month 13, you may see a significant increase in your rate (everyone hates when they get that bill) that’s often hard to drop without lessening your services. Ideally, you’ll get a rate and stick with it because that’s what your budget allows. We think it should be the same with your term life insurance policy.
This is not an uncommon or expensive feature to come by. Many policies from top insurers offer level premiums.
For most people, it’s best to go with a level premium term life insurance policy from the get-go.