Term to 100 insurance is an arguable hybrid of term life insurance and whole life.

Whole life insurance (or permanent) is generally characterized by two attributes – coverage for life, and cash surrender values should cancel the policy. Term life insurance has coverage for a specific duration (less than life) and no cash surrender values.

Term to 100 is a bit of column A, bit of column B. Like whole life, the premiums and the coverage is level for life. Like term life insurance though, there are no cash surrender values. Term 100 is basic – level premiums for life, no cash surrender value.

It is thus suitable for people looking for lifetime coverage, without any enhancements, at the lowest possible cost.

Term 100 has fallen out of favour with life insurance companies, many companies no longer offer term to 100. The problem is that the lack of cash surrender values means consumers don’t cancel their policies – they keep them until they die. This removes the block of consumers who pay premiums for years and then cancel before they die (and thus, no death benefit is paid). Well, this is a problem for the life companies anyway as it means they’re paying more death claims than expected and thus are less profitable.

However there’s available a look-alike product that you can construct from Universal Life (UL) insurance. UL has two cost structures – level, and increasing. If you purchase a UL policy with guaranteed level costs (level COI), and pay the minimum premiums so that no money is put into investments, then you effectively have a term to 100 policy – level premiums guaranteed for life, no cash surrender value.

If you’re shopping for term to 100, you should have your life insurance broker shop both term to 100 and level COI UL to see what premiums are lowest.