Whole
Life Is Permanent Insurance
Author:
Ivon T. Hughes
Permanent
life insurance is any plan that is guaranteed to pay out at some point, rather
than expire.
Whole
life premiums and death benefit which you are quoted at your policy's start,
remain the same throughout the policy's life. But because your insurer will
be investing your premiums, the policy may accumulate a cash reserve. These
funds can be used to pay premiums, reinvested, or saved - it's your choice.
Whole
life insurance can be considerably more expensive than its cousin, term life
insurance, but the death benefits of both are guaranteed as long as the premiums
are met.
THE
DISADVANTAGES OF WHOLE LIFE INSURANCE.
The big problem with a whole life insurance policy is your lack of involvement
in investing the cash value savings. Although the money can still be made
available to you via loans, the investment portfolio itself is entirely decided
upon by your insurance company. And the loan won't be available for quite
some time!
And,
unless you are older, the cost and benefits of term insurance are far better
than whole life.
Whole
life can be used as a forced savings method; if you don't continue to pay
the premium, you'll lose your savings.
IS
WHOLE LIFE INSURANCE RIGHT FOR YOU?
The policyholders who benefit most from purchasing a whole life insurance
policy may be those who may have little interest or experience in investing,
but who want to secure a permanent death benefit.
If
you see the need to cut costs, a term life insurance policy might be a better
choice. If, on the other hand, you want permanent protection but with more
hands on control over the cash involved, universal life insurance might better
fit the bill.
BUT
MOST IMPORTANTLY.
You
need to think carefully about choosing the level of coverage when it come
to life insurance. Too often people make the mistake of too little coverage
or financially overextending themselves. With a whole life policy, defaulting
on premium payments, can mean policy cancellation and the loss of your entire
investment.
Getting the lowest possible premium on your life insurance means getting
the right balance of term length and premium.
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Ivon T. Hughes, The Hughes Trustco Group Ltd.
Online Insurance Broker - Get a FREE Quote TODAY!
Tel: (514) 842-9001 Email: [email protected]
Web: http://www.trustco.ca
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