What is a reduced paid-up insurance?
A reduced paid-up insurance is a type of policy that results when you take the cash value of the policy as the death benefit, rather than the originally agreed-upon coverage amount from a whole life insurance policy. It’s “paid-up” meaning you won’t have to make further premium payments.
What is the difference between a paid-up addition and reduced paid up?
A paid-up addition is a small chunk of whole life that is added to a base whole life policy often through extra premium payments, whereas the reduced paid-up insurance option is chosen when someone no longer wants to pay premiums and henceforth reduces their base policy.
What is reduced paid-up (RPU)?
Reduced Paid-Up (RPU) – One of the contractual options that every single Whole Life policyholder has is the ability to elect RPU status on their policy. Doing so reduces your Whole Life death benefit to the point where it is considered contractually paid up with no further premiums due.