At some point, pay forbecomes a necessary part of adulthood. But if you stick to your policy, you might feel like you’ve wasted a bunch of money for no reason.
But it doesn’t always happen. Fortunately, policyholders have options at the end of their term life insurance policy, including the option to return their premiums.
If you’re in the market for life insurance, start by getting a free price quote so you know exactly what to expect.
To understand exactly how one can go about having themWhen returning the premium it helps to first know what such a policy actually covers.
What is term life insurance?
Term life insurance is a life insurance policy that covers you for a specific period of time, usually between 10 and 30 years. The policy will be active only during that period. on the other hand,Coverage lasts your entire life.
Term life premiums are relatively low and policy amounts can range from $100,000.
Companies will often need oneThe result of which will determine your monthly premium.
What happens when a term life policy expires?
Every term life policy will expire, but many policyholders don’t realize that once that happens they have several options to choose from. Fortunately, there are options to choose from when this happens:
Return of Payment Rider
Some consumers worry that they will be wasting their money if they opt out of a term life policy. That is where the payment is a returncomes This rider will refund your term life premium if you do not die before the policy expires This guarantees that you will get your money back when you expire.
If you have a strong family history and are in good health, it may make sense to purchase a return of payment rider.
But do the math and make sure you can afford it. Like other insurance riders, there is a return of payment riderto the policy. This can make a policy significantly more expensive than a regular term life policy.
If you cancel the policy or stop making payments, the money will not be refunded to you.
You can now explore your term life insurance options by getting a free price estimate.
Before buying a term life policy, you can opt for a policy that allows you to convert it to a whole life policy at some point during the term. Some insurance companies have a specific period during which you can convert the policy, while others allow you to convert the policy at any time. Although there is no fee to convert policies, your premium will usually increase. Whole life premium is much higher than term life premium.
You can convert part of the policy into a whole policy and keep the rest as a term policy. Ask an insurance agent what your options are before purchasing a policy.
Let the policy expire
For most people, the purpose of life insurance is to replace your income when you die so that your loved ones don’t suffer financially. While choosing a tenure, you should make sure that your family still depends on your income till it expires. If you choose the right term, you can let the policy expire without buying a new one. At that point, you should self-insure.
Sign up for a new policy
If a term policy expires and you decide you still need coverage, you can purchase a new policy. This can happen if your life circumstances change after you purchase the initial policy. For example, if you have children later in life, you may need to purchase a new policy to cover their future expenses.
Premiums will generally be more expensive as you age. And if you have certain health conditions, you may not qualify for a term policy as a senior. For example, a 60-year-old woman who wants a $500,000 20-year policy might pay $138 to $218 a month. A 30-year-old woman with a 20-year $500,000 policy might pay $16 to $26 per month.
Your insurance needs may decrease as you get older, so you can spring for a smaller policy or lower amount. For example, you can get a 10-year policy with a payout of $100,000 These premiums will be more affordable while giving some coverage to your loved ones
Get a free price estimate here now or use the table below to explore some of the top life insurance providers
Some people may hesitate to purchase life insurance out of concern that they will lose their money if they opt out of their policy. But it doesn’t always happen. With a life insurance rider, you may be able to get your premiums back or you may be able to convert your policy to one that works better for you in your new circumstances.
Not sure which is the best way forward? You can now easily research your options.