What are the advantages of whole life insurance?

Whole life insurance, one type of permanent life insurance, provides death benefit coverage for the life of the insured. It also carries a savings component that has a cash value when it accumulates on a tax-advantaged basis. Are there death benefit coverage advantages to a whole life insurance policy?

One of the biggest benefits of whole life insurance is that it lasts a lifetime.

Whole life insurance also accumulates a cash value. So, whenever you pay your premium, part of it goes towards the cash value portion of the policy. This cash value portion grows on a tax-deferred basis. Once you’ve built up enough cash value, you can even borrow against it.

It has a minimum rate of return. This is set when you get the policy. When the market fluctuates, your policy won’t; it is guaranteed to earn the interest rate set by the insurer.

It’s often thought to be a safety net for you and your beneficiaries. During your lifetime, you can enjoy “living benefits” such as tax-free loans that you borrow against your policy. Some benefit from using the “living benefits” for their retirement.

It has predictable premiums. The premiums stay the same, no matter what.

You can also earn dividends on your whole life insurance policy. This works with mutual life insurance companies. They pay out dividends based on their profits. You can use this for cash, pay your premium or even add it to your cash value of your policy.

Depending on your whole life insurance provider, you may even have a range of riders to use; such as, term and long-term care.

It can even help with estate planning. A whole life insurance policy can be used to set up a trust. This allows you to leave your heirs all your funds.

There are lots more options than just death benefit coverage with whole life insurance; It’s best to compare policies with your expectations for your lifestyle in mind. Call Advanced Insurance Concepts today and Jim Rooney will work with you to find the best insurance policy.