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In purchasing life insurance in North Carolina, a consumer has the choice of getting a term life insurance or a permanent life insurance. Whichever product the potential policyholder may decide to get, there’s no denying the security enjoyed in knowing their loved ones will have something to fall back on in case of the untimely death of the policyholder.

However, it is still good to know the general features of both types of life insurance policies. Term life insurance provides coverage only for the time frame specified by the policy. Generally, term life insurance has the option of guaranteed renewal in which policyholder may continue to extend the policy even without having to submit himself or herself to tests providing sound health. A term life insurance may also have conversion privilege, in which it can be converted to a permanent policy should the policyholder wish it. On the hand, permanent life insurance typically has cash value, allows its policyholder to borrow an amount from the value of the policy itself. Policyholders also have an option of getting a policy which pays dividends, though there are still permanent life insurance policies that do not offer this feature. There are also options for cash payments and premium reduction.

Under North Carolina law, if the life insurance policy is more than two years from purchase, insurance provider is not allowed to contest its validity. State law also imposes a grace period of 31 days for delayed payment to give extra leeway for the policyholder. If the grace period expires without any payment made, the insurance provider now has justifiable cause to cancel the policy. However, policyholder should check to see if the policy has provision for reinstatement in which, after paying all the necessary fees and making all the necessary requirements, the policy can be enforced even after being lapsed for a period of time.

Policyholders should consider getting optional riders provisions to increase coverage. Examples of these riders include accidental death benefits, disability income, dependent children, long term care rider, spouse rider, and even mortgage protection. State law also provides for interests to be paid in addition to the specified death benefits should the insurance provider fail to pay the benefits within 30 days after getting satisfactory proof of loss.

When a life insurance policy is about to be terminated, the policyholder have the option of getting a replacement policy. However, state law also requires insurance agents to give proper notice on the replacement policy in which the consumer is expected to review the policy before finalizing the transaction.