As the name indicated, whole life insurance will provide a financial protection to your family for your entire life. It can be a little bit different in policy and benefits from insurance company to another company. In general, whole life insurance can offer these benefits:
- Once your policy is approved, you will be guaranteed to have financial protection to your family for your entire life. You premium will be locked; the insurance company can’t increase, or cancel your premium, no matter what your medical conditions is. By this mean, you can have your peace-of-mind.
- One more benefits that all whole life insurance will have is that cash value. To simply understand, cash value is a portion of premium you have to pay in a separated account from your death benefit, in your policy. This value will grow over life time of your policy with interest. There are so many ways to can use this cash value. You can either use it for your retirement, add to your death benefits or you can receive this amount when surrendering your coverage. However, keep in mind that your cash value grows interest with tax-deferred.
- Your beneficiaries will receive a tax-free lump sum amount after your death, and this benefit will be guaranteed as long as you keep the policy. You can even increase your death benefits whenever you want.
- Whole life insurance can also be considered as a mean to keep you reaching your long-term financial goal. Then you can give your beneficiaries a valuable inheritance or support them in paying off mortgage.
On the other hand, there are some disadvantages you should be aware of. Whole life insurance will guarantee for your entire life, it means the premium you have to pay will be much higher than other types. Therefore, you have to carefully watch your financial situation, whether it’s appropriate to pay for that amount through your life time. In addition, this will be a life time commitment. It’s not like you pay for car loans or house mortgage.
It’s always wisely to talk with a trusted insurance advisor according to your needs and financial situation. They can help you in finding the best plan that fit to your needs as well as assist you in all inquiries through time.