Whole life insurance is the best way to guarantee your loved one’s coverage by assuring death benefit with an advantage of a saving component commonly called cash value which is guaranteed. Sometimes whole life insurance may be referred to as permanent or traditional life insurance.
Are you looking for a reliable source for your loved ones for the rest of your remaining days?
When do I need Whole Life Insurance?
The younger the better and the more cheaply it is; that is the guiding slogan for anyone looking to buy life insurance. But ideally, the right time to buy whole life insurance varies between different people as detected by dependence and financial situation.
Whole life insurance is crucial for anyone who is the sole financial provider of the family or there is a debt to be settled.
How does whole Life Insurance Work?
- Whole life insurance is meant to last your entire life provided you as a policyholder remain faithful to the payment of the insurance premium to your time of death.
- Whole life insurance is paid in premiums. It can annual or monthly depending on the agreement of the policy
- Upon your death, your family will receive the death benefit which is tax-free. This means that the whole amount paid for insurance is the same amount that the family will be paid.
What are the advantages of purchasing Whole Life Insurance?
- Provides cover for the whole life
- The premiums do not increase as you get older like term insurance.
- Availability of cash value plus Interests/ Dividends
- Tax-deferred savings account
- Returns are guaranteed which leads to the greater cash value
How does the Cash Value work?
The cash value and death benefits of the insurance are two different things. With each premium payment, a certain percentage is taken into a component of accumulated savings which earns interests and grows over time.
The growth of the cash value is usually slow due to the additional expenses of the insurance company like administration expenses, underwriting costs, and death benefits payouts.
Despite this, the policyholder is guaranteed a certain amount of growth at the end of every year. This has made whole life insurance attract a larger following over the years.
How can I access the cash value of my policy?
- The cash value can be accessed in different ways but each option has its own risks.
- It can be withdrawn tax-free from the cash value of your policy.
- Take a low-interest loan which is considered as borrowing against your life insurance.
- when the policyholder decides to surrender their policy.
Comparison Between Different Life Insurances
- Comparison
- Premium Cost
- Lifelong Cover
- Investment Component
- Cash Value
- Pros
- Cons
- Who needs it?
- Term Insurance
- Lowest
- No
- No
- No
- Easiest, most affordable, Debt protection
- Covers for the specified duration selected in the policy
- People looking for short term liabilities
- Whole Life
- Slightly High
- Yes
- Yes
- Steady, based on initial approved Rate of Return
- Most Reliable for cash and death benefits builds wealth and estate planning, provides guarantees and growth
- Inflexibility to change
- People looking to build Long term assets without market risk.
- Universal Life
- High
- Yes
- Yes
- Variable, based on investment portfolio
- Flexible for premiums build wealth and estate planning
- Slow growth if market crashes
- People looking for building long term assets with flexibility over time and investment.
Whole Life Plans
Following are some general stats and also stats as per person aged 30 in 2020 (male)
- Comparison
- Guaranteed Premiums
- Guaranteed Permanent Cover
- Protection coverage
- Cash Value at age 50
- Cash Value at age 65
- Cash Value at age 85
- Best Suited for
- Premium
- Estate Builder
- 20 years
- Till Age 100
- $100,000 or more
- $32,771
- $83,774
- $210,810
- For those looking for higher long-term value. Ideal for estate planning and covering taxes and fees at death so your estate passes intact to your heirs.
- $112.02 per month
- Wealth Accumulator
- 20 years
- Till Age 100
- $100,000 or more
- $38,801
- $94,534
- $248,048
- For those looking for higher early cash values within the first 20 years. Ideal for building wealth you can access during your lifetime.
- $171.25 per month
Our Trusted Partners
Riders
- Critical Illness
- Waiver of Premium
- Accidental Death
- Accelerated death benefit
- Term life rider allows the purchase of more life coverage.
- Guaranteed purchase option rider