Life Insurance Types | Buying Life Insurance | Understanding Life Insurance | Glossary
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Return of Premium Term Life Insurance

To most consumers, the single most appealing benefit of whole life, or permanent life coverage, is the build-up of cash value over time. Conversely, the largest drawback of whole life is its high cost relative to term life. The good news is that you can have the best of both worlds with an ROP term life insurance policy. While substantially cheaper than whole life coverage, return of premium term life offers a similar investment component by refunding the entirety of the premiums plus interest at the conclusion of the term if the policyholder is still alive. Read on to see why it's worth your time to request a free ROP term life insurance quote today.

How ROP Term Life Works

With return of premium term protection, you will pay annual premiums for the duration of your term just as you would with traditional term coverage. ROP term insurance differs from standard term life in one important respect-your carrier will give back your premiums and then some if you survive the policy's term. In other words, your net life insurance cost will be zero if you outlive the term of the policy. Of course, return of premium term will pay a full death benefit to your beneficiaries if you die prior to the expiration of the term, but otherwise a full refund of your premiums awaits.

Benefits of Return of Premium Term Insurance

Especially if you purchase life insurance when you are young and healthy, the chances that you will die before your 20- or 30-year life insurance policy term expires are slim. If you survive the policy term, you might feel that your premiums essentially went to waste because you never took advantage of the death benefit. Term life insurance with return of premium corrects this problem by basically only charging you if you "use" your policy. Because your premiums will be returned to you if you are alive at the end of the term, your life insurance costs will be nonexistent. Carriers will also add interest to the premium refund, which means ROP term life insurance can also serve as a safe investment vehicle.

Drawbacks of Return of Premium Term Life Insurance

The primary disadvantage of ROP term life insurance is its relatively high cost. Compared to traditional term policies, the premiums of return of premium term life insurance can be up to three times as high. On the other hand, you have to weigh this extra cost against the benefit of receiving all your money back if you outlive the policy's term, which most policyholders will. If you can afford slightly higher premiums in the interim, ROP term life is usually the smartest long-term financial choice for life insurance protection.

Use our free quote retrieval system to compare the costs of ROP term life with a traditional policy by inputting your location into the field above. You can have several ROP term life insurance quotes in less than five minutes.