Life Insurance Return of Premium:

1. What is return of premium life insurance?

   • Return of premium insurance is a term life product where the cumulative premiums paid on the policy during its duration (15, 20 or 30 years) will be paid to you at the end of the level term period.  In the event the owner decides to let a policy lapse, some of these products will return a portion of the cumulative premiums if they are kept for at least 6 years,

     Companies who offer R.O.P. Insurance are: American General, ReliaStar (ING), Genworth Life, Prudential and John Hancock Life Insurance.

2. Why should I buy a Return of Premium Term Life Insurance policy?

   • One of the criticisms of term insurance in the past has been that if the insured person outlives the policy, they have nothing to show for the money that was put into the policy.  Return of Premium (ROP) products address this issue by returning the paid premiums to the insured if they outlive the policy.

     Another point to note is that ROP products get less expensive as the term goes on.  So, if you are interested in a 20 or 30 year term product, we encourage you to explore both conventional term policies and ROP products to compare and decide which product is right for you. 

3. How does a Return of Premium term life insurance policy work?

   • Is this for real?   Yes and in the past year more of the nation’s top insurance companies have begun offering this product.  If the policy is kept for the full term, the insured receives all premiums back – guaranteed.

     How does a company make money on this?  The insurance carriers are continually investing this money and making a profit from the returns on investment.

     Does it cost more than regular term life?

   • 20 year $500K ROP on a 40 year old Male - $1,370
   • 20 year $500K Regular Term on a 40 year old Male - $545
   • 20 year $500K ROP on a 40 year old Female - $1,145
   • 20 year $500K Regular Term on a 40 year old Female - $445
   • 30 year $500K ROP on a 40 year old Male - $1,270
   • 30 year $500K Regular Term on a 40 year old Male - $825
   • 30 year $500K ROP on a 40 year old Female - $980
   • 30 year $500K Regular Term on a 40 year old Female - $640
     
     
4. How does it compare?

   • Compared to Term - The difference between a term policy and ROP is that with term, if the policy term expires and the insured is still living, you can either renew the policy on an annual basis, or you can simply let your coverage lapse if you haven’t converted it to a permanent plan during the life of the policy.  With the ROP product, when the policy expires, you will receive back all of the premiums that you paid into the policy.  

     Compared to Cash Value or Whole Life Insurance – Some ROP products (AIG) actually build cash value. In fact, you can even borrow or take out loans against the cash value of the policy--- similar to a whole life product.  If you haven’t built enough cash value and you quit making payments, your policy will convert to a paid-up life policy with a reduced face amount.

     Who is the ideal buyer for R.O.P.? The ideal buyer for ROP is the individual looking for the benefits of a term policy but would like to receive something in return if they outlive the policy. As the ING brochure states, “The ROP product allows you to do both: in the best terms, you will receive all of your money back. In the worst terms, you have protected your family financially.”

5. How can LifeQuote help you get the R.O.P Life Insurance Policy that’s right for me?

   • Our licensed agents will be happy to assist you in finding a product that best suits your financial needs. We deal with the top companies offering ROP products on the market such as John Hancock and American General (both are A++ rated with A.M. Best).  Please contact us to see how ROP products work and how to get started if you decide this is the right product for you.

Call LifeQuote™ today!
         
           1-800 521 7873 or send an e-mail to info@lifequote.com