Whole Life Insurance 

  • Premiums locked in for lifetime based on current age

  • Combination Life Insurance coverage and Investment Account

  • Cash value increases annually

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Like the name suggests “Whole Life” is a permanent Life Insurance solution that provides coverage for your entire life. This type of Life Insurance has a guaranteed cash value (an amount you receive if you cancel the policy – or an amount you can borrow against) and a guaranteed death benefit (an amount paid to your beneficiaries).

 

While Term Life Insurance is ideal for scenarios such as Mortgage Insurance or other specific time-related situations, Whole Life Insurance is a long-term option that includes both Life Insurance coverage and an investment portion.

 

The premiums you pay are used in part to cover the Insurance amount and a portion forms the “investment” component. The investment component is more passive, long term and stable in nature. Because your investment funds are combined with funds from all other policyholders, a larger investment “pool” is possible.

 

Every year the insurer may return to you, the policyholder, a “dividend” which is used to increase the underlying cash value and overall death benefit. Dividends are fully vested once paid.

 

Overall Whole Life Insurance policies are considered to provide solid returns on investment. On average the internal rate of return at life expectancy is in the 4-5% range, however given this is tax free, it is equivalent to 9-10% external rate of return.

 

Premiums can be payable for life or some policies will be fully paid up over a 10 or 20 year period.  There are  many options when it comes to Whole Life Insurance and we are here to work with you to select the coverage that best suits your situation.