Our hope is after this brief explanation you’ll know enough about this very popular life insurance feature in order to be able to consider it the next time you decide to run a life insurance quote or purchase a plan to protect the income your family needs.
There are dozens of different kinds of plans on the market and additional riders that you can purchase to supplement your life insurance coverage. When you’re shopping for life insurance, it’s important that you’ve got the best plan and you aren’t paying for coverage that you don’t need. We know that it can be scary trying to decide which plan your family will need. We are here to give your family the insurance coverage that they deserve.
Term Life Insurance
In order to understand how the return of premium feature works on term life insurance you need to have a basic understanding of how term life insurance works. Basically, term life insurance is temporary life insurance that you purchase for a set term duration. The most common term life insurance duration periods are 10, 15, 20 and 30 years. Once you exceeded that term period duration for your plan the insurance in effect terminates.
When you have a return of premium term life insurance plan you get all the money back that you paid into the plan in premiums over that entire life of the policy.
For example, let’s say you purchased a 20 year return of premium term life insurance policy 20 years ago. Once you have finished the 20th year of the policy you have the option to get a return of all the premiums you paid into the plan over the 20 years you owned the policy. If you paid $10,000 in premiums over the 20 years of the policy you will get a check for $10,000 returning the premiums you paid over the life of the plan.
You also have options like HSBC term life insurance if this is something you would be interested in.
In general, a term insurance policy is going to be more affordable than other options for life insurance coverage. If you’re looking to buy an insurance plan with a return of premium rider, then you’re going to pay more for your plan than a traditional term insurance policy. If you’re wanting to get the cheapest life insurance coverage, a simple term life insurance plan with no return of premium rider is going to be the best option for you.
Universal Life Insurance
Universal life insurance, unlike term life insurance, is permanent life insurance. In other words, when you purchase a universal life insurance plan, that plan can remain in-force as long as you live. You don’t choose a duration period for universal life insurance, it’s permanent.
How the return of premium feature works on universal life insurance is that you choose how long you want the policy to be in-force before you have the option to terminate the policy in order to get a return of your premium.
For example, let’s say you purchase a universal life insurance policy with a 20 year return of premium feature. Universal life insurance, unlike term life insurance, can accrue cash value in a separate account for you. So what happens is that after year 20 of your universal life insurance plan you have the option to terminate the plan in order to get all the premiums back that you paid into the plan. If you decide that you want to keep the policy in-force rather than ending it to get your money back the plan will continue to generate cash value for you over the life of the policy.
Note: Despite the fact that you can have a return of premium term life insurance policy the term life insurance plan does not accrue or generate cash value like the universal life insurance plan can above.
To get quotes for ROP life insurance you will need to speak directly with an agent. While our form will give you great rates on term life insurance you will need to speak with one of our agents to know how much the return of premium rider will cost. Get started now by filling out the form on this page or give us a call. If you are not sure about how much life insurance you may need you can still contact us directly our check out our page on determining your life insurance needs.
Working With An Independent Insurance Agent
When you’re shopping for life insurance coverage, it’s vital that you get the best plan to protect your family. It can be confusing deciding which kind of plan will work best for you, but luckily our agents are here to help you. Unlike traditional insurance agents, our independent brokers work with dozens of excellent insurance companies across the nation, and we can bring all of the lowest premium rates directly to you. Our independent agents have years of experience helping all kinds of applicants purchase quality life insurance at an affordable rate.
Every insurance company is going to view your application different. Each insurance company is going to give you different rates based on their medical underwriting and their rating system. It’s important that you get dozens of quotes before you decide which one is going to work best for you. When you’re looking for a return of premium life insurance plan, finding the right company could be the difference between getting an affordable plan or buying a policy that breaks your bank every month.
Instead of wasting your time calling all of those companies yourself, let one of our agents do all of the hard work for you. Working with one of our independent insurance agents can help save you both time and money on your insurance coverage. Even if you’ve been declined in the past, there are still several options that you can buy that will give you affordable insurance coverage.
How Much Life Insurance Do You Need To Buy?
Before you buy life insurance, regardless of which kind of plan that you choose, it’s vital that you get the right amount of coverage for your family. There are several factors that you need to get consider when you’re shopping for life insurance coverage. Not having enough life insurance could leave your family with additional expenses and bills that they don’t have the money to pay for.
The first number that you should crunch when you’re calculating your insurance needs is your debts and final expenses that your family would be responsible for if you were to pass away. The first goal of your life insurance is to give your family the money that they need to pay off your outstanding debts without having to empty their bank account. Make sure that your plan is large enough to pay your mortgage, student loans, and all your other debts.
The next number that you should look at is your annual income. The secondary goal of your life insurance plan is to help your family replace your paycheck if something tragic were to happen to you. If you’re one of the main sources of income in your home, your family will struggle to pay for any day-to-day expenses, but that’s where your life insurance plan comes in. It will give them the money that they need to get through the difficult time without struggling financially.
Additionally, you’ll also need to look at any of the fees or taxes that your family will encounter if something tragic were to happen to you. Those taxes can take a chunk out of your family’s inheritance. These are only a few of the different categories that you’ll need to consider when buying a life insurance plan.
Losing a loved one is never easy, but being left with hundreds of thousands of dollars of debt is going to make the situation less burdensome. Nobody wants to think about his or her own death, but planning for the worst will help your family get through the emotional situation.
Return Of Premium Policy – Is It Right For You?
Each person is different, and everyone is going to need different coverage based on their family’s needs. It’s impossible to give a reliable answer without knowing your specific situation, but in most cases, it’s a better decision to skip the return of premium plan and invest the money that you save. Without the return of premium, your insurance fees are going to be drastically lower, which will save you thousands of dollars throughout the course of the insurance plan.
If you have any questions about return of premium life insurance coverage or the different options available to you, please contact one of our agents today. We would be happy to answer those questions and ensure that you’re getting the best plan to meet your needs.
Because you never know what’s going to happen tomorrow, you shouldn’t wait any longer to get the insurance coverage that your family will need if something tragic were to happen. We know that finding life insurance can be a frustrating process, but it doesn’t have to be. We are here to make it as quick and simple as possible. Contact us today and we can get the process started.