ROP/CV Term

[wingateexpress]

Last one I saw was a year or two ago. As I recall it had about $4,000.00 in cash value and in it that I used to buy down the premium on a conversion. The same company had some term on the books that pay dividends. The company is United Heritage.

There used to be deposit term also variants of that using annuities. I have not seen one in years. ROP term is the closest I have seen lately.

Interesting, I'm not familiar with this product line.

 

[jdeasy]

Term that builds cash value.

.....

I had never seen one of those either until a year or so ago. I met with a guy from an FE mailer. He had a $15000 term policy and wanted a $15000 whole life policy.

I can't remember the company he had it with now but we got on the phone and they said it was a term policy and the rates would continue to go up.

I got him approved on a point of sale interview and for less money than he was paying for the term.

When we called back to stop the draft the company said he had $600 cash value in the policy. I said, I thought you said it was term? They said it was but it had some cash value.

The guy told them to send his cash. They did.

 

[wingateexpress]

These products had to have been an ROP Term. Unless there is some exotic product out there that I've never seen. Like a UL hybrid?

 

[jdeasy]

These products had to have been an ROP Term. Unless there is some exotic product out there that I've never seen. Like a UL hybrid?

The company rep called it "cash value term". He did say they don't sell it anymore but they did when this guy bought it.

 

[WinoBlues]

These products had to have been an ROP Term. Unless there is some exotic product out there that I've never seen. Like a UL hybrid?

Or you or I could just be wrong.

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As I remember the one I am talking about was a 30 yr DT. Same with the ones that are earning dividends.

 

[NotEnough]

Thanks for the response everyone! Yes, I mean Cash Value Term VS ROP Term. I was told a cash value term builds cash value, just like a whole life/UL. Only difference is in a cash value term, the level pay period is set like in a traditional term and goes up after that. Also, it expires a specific age such as 75-95 with the reduce paid up options.

Just wanted to know in what areas would you recommend these two products. I've read a lot on the forums about shying away from ROP Term, but to me, for the most part, I try to believe that every product has it's place.

 

[WinoBlues]

Thanks for the response everyone! Yes, I mean Cash Value Term VS ROP Term. I was told a cash value term builds cash value, just like a whole life/UL. Only difference is in a cash value term, the level pay period is set like in a traditional term and goes up after that. Also, it expires a specific age such as 75-95 with the reduce paid up options.

Just wanted to know in what areas would you recommend these two products. I've read a lot on the forums about shying away from ROP Term, but to me, for the most part, I try to believe that every product has it's place.

I would need to get a look at the cash value term. What company are you talking?

 

[rousemark]

Term does not accrue cash value, so no, no one has ever sold this. A UL policy is in some ways a hybrid between a CV policy and a term policy.

As for ROP term policies, your question is really a different answer depending on each company. Most companies will credit a portion of your premiums back if you cancel before the end of the term.

Now, on a scale of Greensky to 10, how helpful was I?

Not Greensky but I would have to put it at a 1 since the information is incorrect.

 

[meclimit]

Cash value term was a concept that never really took off. Back in the day when YRT-99 was popular, companies would set a higher premium then dividend back a portion at the end of the year. It went into an interest bearing dividend account or could be paid in cash.

I am a big fan of YRT term in certain situations. Only know of a few companies that are anywhere close to being competitive with level term products after 6 or 7 years.

 

[Tahoe Ray]

Cash value term was a concept that never really took off. Back in the day when YRT-99 was popular, companies would set a higher premium then dividend back a portion at the end of the year. It went into an interest bearing dividend account or could be paid in cash.

I am a big fan of YRT term in certain situations. Only know of a few companies that are anywhere close to being competitive with level term products after 6 or 7 years.

Your last paragraph is a good point...I've done two cases this year where the client could have used YRT or even 5 year....A 10 year plan, dropping it later in the term, was more cost effective.