decreasing term policy

Meaning

1. 1nouncountablefinance

   A life insurance contract that lasts for a fixed period, during which the amount paid out on death gets smaller each year.

   Grammar: Countable: she took out a decreasing term policy.

   Patterns

   • take out a decreasing term policy
   • a decreasing term policy for a mortgage

   They took out a decreasing term policy to cover the remaining mortgage.

   With a decreasing term policy, the payout shrinks as the loan balance falls.

   A decreasing term policy is usually cheaper than level cover.

Word forms

Common combinations

take out a decreasing term policy

Many couples take out a decreasing term policy with a mortgage.

decreasing term policy payout

The decreasing term policy payout matches the outstanding debt.

cancel a decreasing term policy

You may cancel a decreasing term policy at any time.

decreasing term policy premium

The premium on a decreasing term policy often stays fixed.

mortgage decreasing term policy

A mortgage decreasing term policy ends when the loan is repaid.

Synonyms and how they differ

mortgage protection insurance

This is a close real-world match but names the purpose, not the structure.

declining term assurance

Declining term assurance is a more British phrase for the same idea.

reducing term policy

Reducing term policy is another British wording, with no difference in meaning.

Opposites

Word family

term insurance noun

life cover for a set number of years

policyholder noun

the person who owns an insurance policy

premium noun

the regular payment for insurance

decrease verb

to become smaller

Commonly confused: decreasing term policy or whole life policy?

Practice

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Write a sentence using “decreasing term policy”, then check it and compare it with the examples above.

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