Whole life insurance policies are an investment with no expiration date. They last as long as you do, protecting the financial interests of your loved ones.
Whole life insurance, a type of permanent life insurance, covers you for your whole life. The real difference there is in comparison to term life policies, which last only for a specified period of time. Having the security of being covered for life grants many people peace of mind. It also adds additional protection for your investment in yourself.
The amount you pay in premiums doesn’t just contribute to keeping your policy active, though. You have the added benefit of being able to see the money grow in a cash value which you can use while you are alive. Think of this as an additional savings vehicle. Most life insurance companies will have a minimum interest level that the account will grow every year, or it will keep up with the market interest rate. This gives you the boost you need as an extra savings fund. You can borrow against the value of this account; you need only pay back the loans with interest to make sure your death benefit does not decrease.
A whole life insurance policy gives you the protection you need without a time limit. Your loved ones will be covered whenever you pass away, meaning you can promise them that they will receive that death benefit and be financially secure in the event of your death.
The death benefit is the primary benefit of whole life insurance. This is the value of the policy that you select when you first purchase it. Most policy amounts are in large whole figure sums, of $100,000, $250,000, $500,000 or $1,000,000. Upon your death, your life insurance company will pay your beneficiaries the amount of your death benefit as a cash payment or in trust.
Don’t forget—whole life insurance also has the benefit of the cash value. The cash value of the policy is something you can borrow against during your lifetime. As long as you pay back the loan with interest, you will keep the same death benefit to pass on to your beneficiaries. Unpaid loans will reduce your death benefit by that amount.
Most insurance policies use a level premium, meaning that each month from the day you purchase the policy to your final hours will cost the same.
The cost of your premiums will depend on the amount of your death benefit, your age when you purchase the policy, your sex, your health, and other factors that impact life expectancy. The younger you are and the better health you are in when you purchase the policy, the lower your monthly premiums are likely to be.
Whole life policies are good for the breadwinner to purchase. That way, whenever they pass on, they can be certain that their loved ones will be cared for.
A whole life policy is a sound investment in your loved ones’ financial future. Your monthly premiums will help secure the death benefit as well as the cash value, which you can access during your lifetime. For help in choosing the right whole life policy, contact Jones Insurance Group.