A. This is a good question, planning for inflation is important for term life insurance, because during the entire term period, the death benefit remains level. For a long period of 20 or 30 years, inflation could eat away a large chunk of the further purchasing power of the life insurance death benefit.
You can use the following tool to evaluate two things:
- Given the assumed inflation rate, how much your face amount will be actually worth at the end of the term
- How much face amount you should purchase now in order to achieve equivalent purchasing power in the future