The length of cover you have is dependant on the type of policy you take out. You can get life insurance policies that last for a fixed period or your whole life. For example, you can take out a decreasing term life insurance policy where the payout amount decreases as your loan amount decreases. This type of policy is taken out for a fixed number of years and you’ll no longer be covered when the term length ends. An alternative to decreasing term life insurance is level term life insurance. It works in the same way in that you pay a monthly premium for a fixed number of years, however, the payout amount remains the same throughout the policy. If you want to be covered for your entire life, you should consider a whole of life insurance policy. It’s typically the most expensive life insurance policy but your loved ones are guaranteed a payout in the event of your death.
If you have a mortgage and it has 20 years left on it, you might want to take out cover with a term length of 20 years so you can be certain that when you die, the mortgage is completely paid off. But if you want to leave a lump sum for your family, you’ll want to take out cover for longer.