Lifetime Annuity option at the end of the term

[DAM Jr]

This is my first time running into this and was hoping someone might be able to confirm if I'm on the right track, as I have a meeting with the client first thing. It's regarding the annuity option at the end of the Term Life 30. From what I'm gathering, the annuity simply pays out a specific amount, looks like it tends to be on the lower side, once the 30 years is up, and the insured is still with us. A 10-year guaranteed is also an option, which I'm thinking it does the same thing, but if the payee dies halfway thru, their beneficiary will receive 5 years' worth of payments.

I guess what I'm having trouble with, assuming I'm on track above, why would anybody NOT take this? The term is up, premiums for converting go thru the roof, it's no additional cost. What am I missing?

 

[scagnt83]

Never heard of a living annuitization option on Term.

What carrier? Whats the name of the policy series?

Its most likely a Return of Premium option… which I would suggest taking the shortest payment period possible.

I promise its not annuitization of the DB.