Life Insurance-does this sound right?

[msmiz]

My life insurance policy -I have had the policy for a long time. I receive a billing notice periodically that says" Your premium will be withdrawn from your premium deposit account. you have a premimum dsposit account of $$$$ including incuring interest accrued at 2.5%. At the moment your account is paying 100% of your policy premimum".
Can anyone offer advice if this sounds like it is ok for this to be happening or not. Is it to my advantange.
thanks

 

[ALawyer]

What type of insurance policy is this - whole life? Universal life? Term? How long have you had it?

Clearly the premium is being paid from some pot of money that you must have (over)paid in at some time. You should write to the company and get the full balance in the account, the current premium rate and the maximum premium rate and figure out when the premium account would be depleted.

 

[msmiz]

life insurance policy-SENIOR MEMBER

I have had it since the 1970's but the insurance rep re-wrote it in 1997 and told me I do not have to worry about payments anymore.

it says:
TYPE OF MORALITY COST: Level Term For Life

I will contact the company and ask the questions you suggested.

 

[msmiz]

new info

Just noticed it reads that annual premimum is $300 to be paid $150 May 1st and Nov 1st. It says $150 will be drawn from the premimum deposit account. It says the balance is $235.78 including 2.50%. I have not made any payments since 1997 it has been coming form this.

The policy says The Contactual premimums are allocated as follows: 100% in a 10-year compound interest-guaranteed invstment option. In order to keep the policy in force, a postive balance must be maintained in the fund until the death of thr person insured.

 

[ALawyer]

That pot is about to be depleted. You'll have to start payingpremium again or the policy will lapse.

IF you are in good health, apply for NEW 10 year term -- you may want to use the internet on a site like quickquote.com -- and you will save some money. If your health is not good, and new coverage would be too expensive, ok into the conversion rights under the policy.