Will I get any money back at the end of my term?
With ordinary term life insurance, no, you won't get any money back if the insured survives until the end of the term of coverage. Many life insurance customers find this satisfactory, since all they wish to purchase is financial protection, and money spent is money gone.
However, if you purchase return of premium life insurance (ROP life insurance), a variation on ordinary term life insurance, then at the end of the term of coverage, you will be refunded all of the premiums that you paid for the policy. How can the insurance company make any money on return of premium life insurance? As will all types of insurance, the company invests your premiums and takes its profit from the positive returns on its investments.
Naturally, in order that the insurer's returns on your return of premium policy be large enough to cover the costs of administrating the poilcy, return of premium policies must be more expensive than the norm. This does not make for exorbitant rates, nevertheless. We may find you ROP life insurance rates in the neighborhood of just one and a half times your cheapest term life insurance rate.
