How many of you have it? If you don't have it, are you planning to get some in the near future?
As many of the older posters here know, I adopted my kid sister several years ago. She's 18 now, but due to her epilepsy, she's still unable to perform many normal tasks on a consistent basis, and therefore has trouble landing a decent job. I've got no problem taking care of her ad infinitum, but in the unlikely event that something tragic should happen to me, she'd be left all alone. We're in the process of trying to get her disability benefits, but the process is lengthy and there are no guarantees.
As such, I've recently begun evaluating my current life insurance policy and my future options. When I was a young 20 something, I added a $15k policy to my car policy for the multi-line discount, but I no longer feel that is enough to help her get started on her own if I should ever pass. I just talked to my State Farm agent and as far as I can tell, there are 3 basic options:
1. Whole life - keep paying til you die, the full policy amount is awarded to the beneficiary upon death, regardless of age
2. Term life - Pay a set amount for a set term. If you die during the term, the full amount is awarded. Otherwise, the policy expires and the money is gone.
3. Term life w/ return of premium - I've never heard of this until today when I talked to my agent, but apparently this is the same as #2, with the exception that at the end of the term, all of the premiums you have paid in are returned in full. For example, if I took out a 100k 30yr term life policy at my current rates, I'd get $33k back at the end of the term.
Option 3 seems like the most attractive one, especially since monthly premiums for a term life policy are (at least in my case) about 60% of the whole life policy for a much larger policy amount (50k whole, 100k term). Am I missing anything? Anything else I should look for?
Incidentally, the whole life policy I started ~10 yrs ago has a cash payout upon cancellation which is currently valued at $800. Assuming I go with a new (much larger) policy, I'd probably cash out the current one and pad my savings a little. Spiffy, that.