Return of Premium Term Insurance
Also considered a term insurance because it has a specified life-span, with a return-of-premium policy, a death benefit is paid out should you pass away during the life of the policy. But if you live past specified term, you get all of your money back - dollar for dollar. So no matter what happens to you - whether you die while covered or outlive the policy - money is distributed.
While a return-of-premium policy isn't as cheap as term life, it's significantly more affordable than whole life and for the right buyer who is not interested in tax benefits or cash value and is certain he/she would not choose to cancel before the term ends, it may make a lot of sense.
Cost differences range about 50% more than a comparable term life plan.
There are restrictions as to when you can withdraw your premiums, and there is a stiff penalty should you decide not to go the full term. We recommend that you only consider ROP Term if you know you will maintain the policy for the full term. Anything less and you lose the advantages - and will have paid extra for benefit coverage.