Premium payment term

The premium payment term is the number of years you actually pay. It is frequently the same as the policy term, but it can be shorter — a limited-pay arrangement, where you finish paying before the cover ends.

A shorter payment term means higher premiums while you are paying, because the same total is being collected over fewer years.

Related terms

• Policy term How long the cover lasts. Distinct from how long you pay for it.
• Premium The amount you pay the insurer for cover, at the frequency the policy sets.
• Modal premium The amount payable each time, at the chosen payment frequency.

Back to the glossary · The four categories · How applying works