In most human cancer cells, cellular immortalization relies on the activation and recruitment of telomerase to telomeres. The telomere-binding protein TPP1 and the TEN domain of the telomerase catalytic subunit TERT regulate telomerase recruitment. TERT contains a unique domain, called the insertion in fingers domain (IFD), located within the conserved reverse transcriptase domain. We report the role of specific hTERT IFD residues in the regulation of telomerase activity and processivity, recruitment to telomeres, and cell survival. One hTERT IFD variant, hTERT-L805A, with reduced activity and processivity showed impaired telomere association, which could be partially rescued by overexpression of TPP1-POT1. Another previously reported hTERT IFD mutant enzyme with similarly low levels of activity and processivity, hTERT-V791Y, displayed defects in telomere binding and was insensitive to TPP1-POT1 overexpression. Our results provide the first evidence that the IFD can mediate enzyme processivity and telomerase recruitment to telomeres in a TPP1-dependent manner. Moreover, unlike hTERT-V791Y, hTERT-V763S, a variant with reduced activity but increased processivity, and hTERT-L805A, could both immortalize limited-life-span cells, but cells expressing these two mutant enzymes displayed growth defects, increased apoptosis, DNA damage at telomeres, and short telomeres. Our results highlight the importance of the IFD in maintaining short telomeres and in cell survival.