ROP gives you the peace of mind of knowing you have the coverage you need and the benefit of paying yourself back.
You’re just out of college, ready to start a family and you’re fairly healthy. You decided to purchase a 30-year term life insurance policy. By then, you’ll only be in your middle to late 50s. You’re still in the prime of your life. That term life insurance policy you bought and paid premiums on for 30 years will have expired and you nor your family will have benefited from it. That’s when you realize you have options.
Some term life policies work just like that. You pay your premiums and in the end if you outlive the policy you don’t see any benefit, but there are those that allow you choices. Your AC Financial Adviser can tell you about a term life policy that allows you to either convert your term life to permanent coverage, or you can have all of the premiums you paid over the years returned to you.
Why would you want your premiums returned? Several reasons. One of the best is so that you can purchase more life insurance, but you can also use that money to supplement your retirement income, help pay for your children’s college education, pay off your mortgage, or use it to fund a buy-sell agreement for your business. A return of premium rider allows you to take a refund of part or all of the premiums you’ve paid into the policy and you choose what to do with the funds.
Using the return of premium rider, you continue to be insured throughout the life of the policy provided your premiums are paid up to date. It gives you the peace of mind of knowing you have the coverage you need when you need it, and you get the added benefit of being able to pay yourself back everything you put into it. Return of premium makes sense, too because the funds are returned to you tax-free. Unlike a 401K or IRA, there are no penalties for withdrawal. You are simply refunded what you paid in.
Call your AC Financial Adviser at 877-435-2283 to learn more about term life and whether a return of premium rider on your policy will benefit you.
