What Is A Whole Life Policy?A whole life policy is a type of life insurance that provides guaranteed death benefits during the entire life of the policyholder. The coverage is extended for as long as the insured lives, as long as the premiums are paid up and the policy is not surrendered. These plans are designed to cater to those who do not want a fixed tenure, but rather have insurance cover till whenever they meet their demise. The policy will also build up a cash value which makes the premiums higher than some other plans.
Benefits Of Whole Life Policy
Benefits of Whole Life Policy:
Lifetime Protection – The coverage of the policy will end only when the life insured passes on. This kind of life insurance keeps premiums steady through the entire policy. The policy will not be cancelled upon the diagnosis of any illness or other health issues. The only requirement is that premiums must be paid up as and when required.
Stable Premiums – Taking a whole life policy at a young age can lock in a low premium rate for the entire term.
Cash Value – These policies accumulate a cash value through the course of the policy. The cash value can be used to reduce future premiums, or it can be withdrawn. Loans may also be available against the cash value of the policy.
Flexibility – Whole life insurance plans allow the policyholder to use the cash value or retain it in the policy to grow the value of the plan even further.