Return of Premium Life Insurance

Return of Premium Life Insurance provides the owner of a life insurance policy the ability to get all their money back at the end of the policy's term.

For example, if you owned a return of premium life insurance policy that had a 30 year term rate guarantee, at the end of the 30 years if the insured person was still alive, you would receive all the money back that you paid over the 30 years. 

What are the Advantages of Return of Premium Policies?

If you are in average to excellent health, a return of premium life insurance policy is only a little bit more than a term insurance policy that has no money back provisions.  In many cases the tax free* rate of return on the additional premium approaches 8% or 9%!

*If the premiums are paid with after tax dollars then the money back you receive after your term ends is tax free.

What are the Disadvantages to owning a Return of Premium Life Insurance Plan?

Return of Premium Life Insurance Plans cost more.  With a typical no money back life insurance plan you could buy more insurance for the same price, or save money, by buying a plan where the insurance company keeps all your money if you are still alive at the end of your term.