Ask Terry Questions Renewable Level Benefit Term Life Insurance ?

Renewable Level Benefit Term Life Insurance ?

By Terry Savage on March 01, 2024 | Insurance & Annuities

Hi Terry, 1st of all, love listening to you on WGN radio.
At age 51 we bought this $100,000, 20 year policy for my husband. He will be 71 in June.
They offer a return of premium or renew with premiums going up each year. Current premium is $63 a month. We don’t want to increase our monthly expenses as we prepare for retirement. Should we get our premiums paid back and put in an IRA or something else? Thank you very much for your guidance. Patty

Terry Says

Do you have a ROP — return of premium — feature on this term policy? It’s rare that people do, since it raises the annual premium by about 30%.
The whole idea of level term is that at the end of the term, you’ll have increased your other savings and have paid off most of your debt — so you’ll have less need for the insurance payout if the insured dies.

So that’s what you have to ask yourself: Do you still need this insurance? Ask about the premiums in the future. It’s going to get VERY expensive!



a personal
finance question