Term Insurance vs. My Life Insurance Plan via the office

[Jenananda]

Hi,

Sounds like you're still young. You might consider ROP type term and get it for say 20 or 30 years. The advantage is the premium will all be returned later on in the term, 100%. The rate should be pretty low, especially if you are in good health and a non-smoker.

 

[Guest]

You can get your own life quotes here for term and permanent.

https://online.statefarm.com/apps/lrq3/lrq02/StateSelect.asp

And do not be deterred by them telling you it will take a few minutes. It may take a few seconds, but it is fast.

After you get a quote, they will ask if you want an illustration. Answer yes. An illustration is a year by year breakdown of premiums, charges, and cash value accumulating in your account (if you go with whole life).

What is great about being able to do your own illustrations, you can see how the various options with whole life affect the cash value.

Just wondering, do they also have a specimen contract to view?

James, if they do I have not found it.

 

[Guest]

State Farm will not give quotes for UL. However, Prudential will:

https://www.prudential.com/view/pag...ProductType=&UserID=&CampaignExtension=004458

 

[mateo3000]

I have to agree with the person that talked about the Return of Premium. I've been helping a lot of families to see how a policy with ROP can pay into it for years and if they need the benefit (i.e. you or your wife die) then you get the money back. In the cases of mortgage protection (life term designed to help pay for the mortgage) if a family has a 30 yr mortgage and we give them a 20 yr term with ROP they can plan on paying off their house early. provided they use the money in that manner.

 

[James]

I have to agree with the person that talked about the Return of Premium. I've been helping a lot of families to see how a policy with ROP can pay into it for years and if they need the benefit (i.e. you or your wife die) then you get the money back. In the cases of mortgage protection (life term designed to help pay for the mortgage) if a family has a 30 yr mortgage and we give them a 20 yr term with ROP they can plan on paying off their house early. provided they use the money in that manner.

While its not a totally bad thing, the ROP that is. Yet I don't like to sell 20-30 year term policies, seems to defeat the idea of Term. Would sell more if they offered it up on 10 year policies.

 

[BeverlyHillsLif]

On the other hand, I understand if I go with Term Life Insurance, my wife and I would be insurred for something around 400,000. Should one of us die, the other would get payments for "x" years to live the life style we live today.

Since the gurus have worked on this question so thoroughly below, I only wanted to touch on one small issue:

There is no reason to take the death benefit payout on a term policy as payments over time. You can take the death benefit as a single lump sum. I often find consumers who think a 10 year term has to be paid out over 10 years.
You have the option of how you want your death benefit paid, but is generally paid as one lump sum.
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While its not a totally bad thing, the ROP that is. Yet I don't like to sell 20-30 year term policies, seems to defeat the idea of Term. Would sell more if they offered it up on 10 year policies.

The downside of most ROP policies is that you have to keep the policy to fruition to get the refund. If you by a 20 year ROP and pay 300% times the normal premium and then drop out at year 15, you have paid big bucks for a promise the carrier never had to keep. There are better uses for the excess cash. But if you really must have an ROP, look at constructing one yourself. Buy a very low cost Universal life policy, but solve for a cash value equal to premiums paid at year 20. It will run like an ROP, but if you want to walk away at year 12 or 15 etc you'll have a cash value equal to most of your premiums paid and can walk away. it eliminates the duration risk.

 

[dgoldenz]

This post is five years old dude.

 

[SportsNut]

This post is five years old dude.

That is soooooo funny.
A thread can sit there for all that time and then a lone ranger comes along... and apparently without checking the dormancy of a thread, blasts away with a great deal of thought and preparation into a response...
And the op is loooong gone and will never read these pearls of wisdom in the post.

 

[VolAgent]

Since the gurus have worked on this question so thoroughly below, I only wanted to touch on one small issue:

There is no reason to take the death benefit payout on a term policy as payments over time. You can take the death benefit as a single lump sum. I often find consumers who think a 10 year term has to be paid out over 10 years.
You have the option of how you want your death benefit paid, but is generally paid as one lump sum.

Really, you have found people who think they have to take a 10 year term paid out over 10 years? So, do you have to take the payout on a 30 year term over 30 years too?

 

[Newby]

Really, you have found people who think they have to take a 10 year term paid out over 10 years? So, do you have to take the payout on a 30 year term over 30 years too?

I meet people every month that think a 10-year term works like a 10-pay whole life.

The general public is VERY ignorant about how life insurance works.