Whole Life Insurance Overview

Whole life insurance offers protection for as long as the insured is alive, not just for a specified time period. In the event that the policyholder dies, his or her beneficiaries will receive the amount stated in the policy. It also features a cash value that accumulates over the life of the policy which can be withdrawn by the insured.

Types of Whole Life Insurance

When buying whole life insurance you can choose from participating  whole life,  interest-sensitive whole life, or single-premium whole life insurance.

Traditional whole life insurance provides the policyholder with guaranteed cash to pass on to beneficiaries on his or her death. It also allows the insured to cancel the policy and receive the cash surrender value. On the other hand, interest-sensitive whole life insurance features more flexibility in terms of the amount of your death benefit. It is also called current assumptive life policy, and has the ability to include current interest into the policy, resulting in increased cash value. Finally, single-premium whole life insurance is appropriate if you have a large amount of money to buy the insurance upfront. The cash value builds up quickly because the policy is fully funded. The amount of the death benefit is based on the amount invested, and the circumstances of the insured.

Whole Life Insurance Advantages

  •       Covers the whole life of the insured
  •       A variety of options to suit individual needs
  •       Builds cash value
  •       Cash can be withdrawn or borrowed


Pros and Cons of Whole Life Insurance

With whole life insurance, your premium remains constant throughout the life of the policy. You are also covered until the time of your passing, no matter how long that may be. Unless you make changes on your policy or default on your payment, you have lifelong coverage with no future medical examinations.

However, whole life insurance are higher in the early years as compared to term life insurance. It is also not flexible when premium amounts and payment schedules are in question. If for some reason, you are unable to pay the monthly premium on time, you may need to use the cash value in order to pay. If payment is not made, you can lose coverage.   If your interested in learning more about Whole Life Insurance and if its right for you give us a call at  401-884-4600 . These products are a little more involved in comparison to getting affordable term life insurance quotes.

This article is for informational purposes only and does not constitute financial advice.  Before purchasing life insurance, we recommend you read the policy and speak with a financial professional before making a decision.  Interest earned may not be insured, may lose value and there can be tax consequences depending upon your situation.


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