Return Of Premium Term Life Explained
The return of premium term life policy is one of the more interesting recent developments in the life insurance industry.
After many years of enthusiastically opposing the cash value type insurance policies I cannot believe that the term supporters are going to support a return of premium term life policy.
May be the buyers who like permanent life insurance may be willing to participate in this type of policy.
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- Policy Description
What the life insurance companies are doing here is adding just enough premium to a regular term policy that when invested would provide sufficient cash value to equal the total premium paid over the term period.
Let us suppose you bought a 20 year return of premium term policy and you pay $300.00 per year for the policy at the end of the 20 year term period you would get back $6000.00 if you did not die in the interim.
This sounds like a good deal but let us go back to the original argument put forth by the who like only term insurance. Had you invested the difference in cost between a regular 20 year term policy premium and that of the return of premium policy wouldn’t you end up with more money?
The answer to that question is more than likely yes…if you are an investor. What about the people who are not investing any money at all…much less the small amount put into a term policy.
Would they not be better off putting some money in this return of premium term life policy? They will have some life insurance in the event of untimely death and if they live they will get back all their money.
As to whether or not this policy is for you, however, is something that you will have to judge for yourself. This is a level face amount policy which would be paid to your beneficiary in a lump sum or, if you choose, in thee form of a monthly income.
- Optional Policy Riders
You have the option of adding the waiver of premium rider to this policy for a minimal cost. The accidental death benefit rider can also be included.
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