What is increasing term insurance?

Increasing term insurance is a specific type of term life insurance characterized by a death benefit that rises at scheduled intervals throughout the policy term. This means that unlike traditional term insurance, which has a fixed death benefit throughout its duration, increasing term insurance is designed to provide a greater payout as time goes on. This feature is particularly appealing to individuals who anticipate increasing financial responsibilities or those who wish to maintain the purchasing power of the death benefit over time in the face of inflation.

The main idea behind increasing term insurance is to provide a level of financial security that adapts to the policyholder's changing needs, making it an attractive choice for individuals who may require greater coverage as they age or as their family circumstances evolve. By structuring the policy this way, it ensures that beneficiaries will receive a more substantial benefit in the future, aligning with the rising costs of living or personal financial obligations.