Whole Life Insurance Policy: The Basics
Did you know that 1 out of 5 people feel that they do not have enough life insurance? If you are considering changing your current life insurance or are planning on taking out a plan for the first time, but are feeling confused with all your options, you are in the right place. We have put together this guide to help you learn more in-depth about what a whole life insurance policy is.
Keep reading to learn everything there is to know about this insurance option.
Benefits of Whole Life Insurance
One of the major benefits of whole life insurance is that you never have to worry about the premiums going up because they are fixed. This means that no matter what the market conditions are, you have zero worries about your price changing.
Another benefit of simplified issue whole life is that you might be able to take out a loan in the future or withdraw funds from your account as needed. The last benefit worth mentioning is that your death benefit is guaranteed as long as you keep up with your required premium payments.
The reason you can take out a loan on your policy is that whole life insurance builds a cash value after some time. Every time you make a payment towards your premium, a portion of it goes into a savings part of the policy that is known as cash value.
The more payments you make the higher your cash value becomes, which is when you might have the option to withdraw funds or borrow from the policy. The rules to borrow all depend on the company that you choose and your policy options.
Who Should Take Out a Policy?
Any adult that is responsible for others financially should have a plan no matter what. Whether opting for a whole life or a term life plan will depend on your circumstances. A good reason to take out a whole life policy is if you currently have a term life that is about to expire and they are giving you the option to convert it to whole life without a medical exam and you have a serious illness or health concern.
You might also want to take out a whole life policy if you want the plan for the rest of your life unlike with a term policy where you have to choose how many years you want it for (10, 15, 20, 30, etc).
Feeling Like a Whole Life Insurance Policy Pro?
We hope that now that we shared the ins and outs of a whole life insurance policy, you can make an informed decision whether or not whole life insurance is for you. Make sure to not rush into signing with the first company that you get a quote from. Take the time to do your research and make sure you choose the perfect plan for you and your needs.
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