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It's been a while since I took a business math course, but isn't this about .46% annual interest? If I am correct, perhaps one could argue also, that she could do better putting that same amount in a savings account, and she would keep it after 24 years instead of giving it away. ( Some math major help me out here.)
Perhaps she does not understand the purpose of term insurance and its drawback. It's good to get $20K instant estate, but keep it too long, and it will cost you big time. I thought that's why they invented Universal Life. Something to phase in a cash accrual after the initial period....
edit:
OK, here's what I found. The AARP site shows NYLife as the provider, and discusses "final" expenses under the heading "permanent" life, and discusses the pros and cons of both term and permanent policies. If she understood the differences between permanent and term as they are presented on the website, she should have asked for permanent.
She has only had two years with this policy.... so she's not out all that much, and in the meantime has had $20K protection. If she doesn't think she will live much longer, she may be better off keeping what she has.... sometimes people will not disclose everything, especially probable serious health issues that they can conceal.
No she's perfectly healthy. She...like most people I've met with the AARP term-life plan...didn't understand that it was term. She also didn't understand that the payment goes up every 5-years even though it is well disclosed on their advertising.
Some seniors (and future seniors) actually believe the AARP is an organization that looks out for them. They see the AARP logo and don't read the rest of the brochure.
End of the story is: she canceled this plan and I sold her a level premium $20,000 policy.