Like term insurance, whole life has level premiums
. Because mortality costs are not level, but increase over the life of the policy, at first the premiums exceed the actuarial cost of the fixed death benefit so that the policy can build up a cash reserve to prefund the mortality costs when they come to exceed the premiums.
Single-premium products have a higher risk exposure than for level premiums
, with other product features, such as the term, the same.
You might suggest level premiums
over the term and the ability to convert the policy to permanent insurance without a new medical exam.
Protection up to the age of 100 by paying guaranteed level premiums
to age 85
* The Reasons: Buyers lock in level premiums
for life and can use dividends to buy paid-up additions.
The product has guaranteed level premiums
, guaranteed cash value and guaranteed death benefits.
So, when presented with a life settlement investment opportunity, the first question you must ask is not how much is placed in escrow to pay premiums but how many years will the estimated level premiums
carry the policy.
With disability insurance, the coverage will not necessarily offer level premiums
, level benefits, and a guarantee of no policy cancellation.
* level premiums
and a level face amount between each "redetermination period;"
Underwritten by the Minnesota Life Insurance Company, the plan features level premiums
and level benefits, meaning rates do not increase with age for the life of the policy, and benefits never decrease during the plan term.
Also, ensure you can afford the premiums later on, as you will pay a higher premium than if you had opted for level premiums