Do I Get My Money Back If I Cancel Term Life Insurance?

Shawn Plummer

CEO, The Annuity Expert

Understanding Refunds in Term Life Insurance Policies

Standard Term Life Insurance

  • No Refund: With standard term life insurance, if you cancel the policy, you do not receive a refund.
  • Payment Structure: You pay regular premiums during the policy term.
  • Coverage Period: It only provides coverage for a specified term.
  • Policy Expiration: If you outlive the policy, there is no payout.

Return Of Premium Term Life Insurance

  • Refund Available: If you have a Return Of Premium (ROP) term life insurance policy, you can get a refund.
  • Higher Premiums: ROP policies typically have higher premiums than standard term policies.
  • Policy Cancellation: On canceling before the term ends, you may receive a partial refund.
  • Full Term Completion: If you keep the policy for the full term, you get all your premiums back.
  • Cost-Effectiveness: It’s more expensive but provides a refund if you outlive the policy.

Choosing the Right Policy

  • Consider your financial needs and long-term goals.
  • Assess the cost difference between standard and ROP policies.
  • Think about the likelihood of needing a refund.


In summary, standard term life insurance does not offer a refund upon cancellation, whereas a Return Of Premium policy does, albeit at higher premium costs. It’s crucial to weigh the pros and cons of each policy type based on your personal financial situation. Contact us today for a free quote.

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Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

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

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