Jacksonville, Florida — Some important features of whole life insurance policies

Whole life insurance is a type of term life insurance coverage for your entire life and not for a particular period like permanent life insurance. You just need to keep on making the premium payments on time.

With cash value accumulation and level premium, whole life insurance is a good option for long term goals. The assured cash values can offer money in future to assist with short term needs or contingencies.

Whole life insurance features

Premiums usually are level and to be paid for life: As whole life insurance premiums are level premiums, the younger you are while buying a whole life policy, the cheaper the yearly premiums would be.

Whole life policies are also available from insurers that come with smaller premium payment periods like 15 years or a one-time premium payment.

Assured cash values: Whole life insurance is not similar to term life insurance, which doesn’t accumulate cash value. A part of your premium that you pay into your whole life insurance policy is accumulated as guaranteed cash value. If you opt to terminate the policy, these cash values would be given to you. On the other hand, throughout the period for which the policy is in effect, you might take out a loan against these cash values as a policy loan at the existing policy loan interest rate.

The guaranteed cash value amount is dependent on the type of whole life policy you have in place, size of the policy and number of years you have had it. The increase in cash values is tax deferred according to the existing federal income tax regulations. The amount that you borrow lowers the cash surrender value and death benefit.  

Dividends

Whole life policies can receive dividends. Dividends are produced when the actual life insurance costs become less than what was presumed in fixing the premiums. When this occurs, the insurance company might return a part of your insurance premium as dividend to you. Dividends are not assured as you don’t have any idea about the actual costs beforehand.  Check out more information on Miami Health Insurance today!