Deposit Term Life Insurance

Shawn Plummer

CEO, The Annuity Expert

When most people think about life insurance, they think about term life insurance. This is the most common type of life insurance policy, and it is designed to provide protection for a specific period of time. However, there are other types of life insurance policies available, including deposit term life insurance. In this guide, we will discuss the benefits of deposit term life insurance and help you decide if this policy is right for you!

What is Deposit Term Life Insurance?

Deposit term insurance is a level term insurance policy that has a much higher premium (your deposit) for the first year than for subsequent years. The initial premium is significantly higher than average term insurance rates needed to cover the cost of mortality during the term period.

Put down a lump sum upfront in exchange for lower rates in the future.

How Do Deposit Term Insurance Premiums Work?

The excess front-end premium is put away to earn interest. The money from the deposit and the interest will help pay for some of the following year’s premiums. The premium levels are set so that the whole deposit will be used up when the final annual premium is paid. This arrangement lets you pay a part of the premium in advance.

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Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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