Calling ROP Free Insurance?

[FEsalesNC]

Is there a professional way of referring to full return of premium by way of rider on policy, as Free Insurance? or is it even allowed?

Just asking as I am a big fan of the ROP rider options but wouldn't want to sound like a used car salesman trying to play on words. Not that there's anything wrong with car salesman they buy insurance too lol.

 

[moonlightandmargaritas]

Is there a professional way of referring to full return of premium by way of rider on policy, as Free Insurance? or is it even allowed?

There are no bigger rip-offs than "ROP". Sucker's bet. Compounding the problem by calling it "free insurance" seems.....misleading.

 

[DHK]

Better prospecting: The foolproof script for selling return-of-premium term insurance | LifeHealthPro

Just keep in mind that this is a magazine article, not a compliance endorsement.

 

[Josh]

It's not free which makes that a lie. Rule of thumb, don't lie to your clients.

It does however pay you back every dollar you've paid for it if you don't use it.

 

[FEsalesNC]

So the ethical language would be to simply say ... it pays you back every dollar if you dont use it...

thanks Josh thats all I was looking for. And yes I know ROP is not something all believe in as MM above. I just really like it in so much as how clients respond to it.

It's not free which makes that a lie. Rule of thumb, don't lie to your clients.

It does however pay you back every dollar you've paid for it if you don't use it.

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Thanks for the link.

Better prospecting: The foolproof script for selling return-of-premium term insurance | LifeHealthPro

Just keep in mind that this is a magazine article, not a compliance endorsement.

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Just curious do you feel that way about all ROP's on all types of insurance? I'm asking would you look at it differently for say CI vs DI vs Term life?

Or are you completely of the invest the difference mindset? Thanks

There are no bigger rip-offs than "ROP". Sucker's bet. Compounding the problem by calling it "free insurance" seems.....misleading.

 

[DHK]

ROP Term is simply cash value term life insurance... with no access to the cash values - until you surrender. And even then, it's a sliding scale of what you'd get back.

It's a concept sale... and most ROP Term policies have rather high premiums too.

 

[FEsalesNC]

Thanks DHK. I agree it is a concept sale and that the ROP cost is somewhat high, but folks love the idea of getting their money back. And love is an emotion. And buying insurance is often an emotional sale.

I'll ask you the question I posed to MM. Would you look at ROP in a more favorable light when selling CI or DI for example vs Term life? Or is it simply a matter of invest the difference in all cases in your opinion?

ROP Term is simply cash value term life insurance... with no access to the cash values - until you surrender. And even then, it's a sliding scale of what you'd get back.

It's a concept sale... and most ROP Term policies have rather high premiums too.

 

[DHK]

I look at it more favorably with DI or CI... because there is a (good) chance that you may never need these coverages.

And many times, even if you keep the policy, the policy will expire as you age.... so if you can get all (or most) of your money back from the premiums... go for it.


For the same premium, I could probably find a perm/term blend that'll grow a cash value compared to an ROP Term.

I don't do this "buy term and invest the difference" nonsense.

 

[FEsalesNC]

I don't do this "buy term and invest the difference" nonsense.

That's the thing I don't buy into that either as folks never follow through with that plan.

edited to add that my original question was actually geared towards CI/DI sales. Thanks

 

[WinoBlues]

So the ethical language would be to simply say ... it pays you back every dollar if you dont use it...

thanks Josh thats all I was looking for. And yes I know ROP is not something all believe in as MM above. I just really like it in so much as how clients respond to it.



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Thanks for the link.



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Just curious do you feel that way about all ROP's on all types of insurance? I'm asking would you look at it differently for say CI vs DI vs Term life?

Or are you completely of the invest the difference mindset? Thanks

Nope. Not in all or even most cases. Depends on the carrier and the contract. Example. Cincinnati Life's older ones returned all premium paid including riders. Which made the RdPd option in the end pretty strong up pretty strong. Today their newer plans only return the base premium. Which is higher since most ROP plans have increased their premiums. As a side note they are very sticky plans persistency wise. I reviewed an old People's Benefit Life I have on a client that is getting close to his term date. The $65,000 ROP at the end is what is keeping him keeping it.