Whole Life Insurance

Whole Life Insurance is a type of permanent life insurance policy that has 3 guarantees – guaranteed death benefit, guaranteed cash value, and guaranteed premiums. Aside from guaranteed values, there is potential for greater cash value accumulation, which can also increase the death benefit over time.

Whole life insurance policies are one type of cash value insurance. Whole life policies offer protection through a lifetime – that is, for a person´s “whole life.”

From the day a person buys the policy, they pay a scheduled premium. The scheduled premium may be level or may increase after a fixed time period, but it will not change from the amount(s) shown in the policy schedule. It is important to look at the policy schedule to understand what the premium payments will be and that they are affordable over time.

This premium is based on age at the time of purchase. Initially, it will be higher than the premium paid for a term policy, but they are likely to decrease over time if the policy is kept for a long time. Part of each premium payment will go to cash value growth, part for the death benefit, and part for expenses (such as commissions and administrative costs).

There is no need to renew the whole life policies. As long as the premium is paid when due, coverage will continue in force.