Whole life insurance

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Whole life insurance

A contract with both insurance and investment components: (1) It pays off a stated amount upon the death of the insured, and (2) it accumulates a cash value that the policyholder can redeem or borrow against.
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Whole Life Insurance

A life insurance policy with no expiration date. That is, a whole life insurance policy provides coverage for the entire life of the policyholder (provided he/she continues to make premium payments). When the policyholder dies, regardless of when that is, his/her beneficiaries receive the death benefit. Whole life insurance policies also include a cash surrender value, allowing the policyholder to recover part of the premium he/she has invested in the policy should he/she ever decide to cancel the policy.
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whole life insurance

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Whole life insurance.

A whole life insurance policy is a type of permanent insurance that provides a guaranteed death benefit and has fixed premiums.

This traditional life insurance is sometimes also known as straight life insurance or cash value insurance.

With a whole life policy, a portion of your premium pays for the insurance and the rest accumulates tax deferred in a cash value account. You may be able to borrow against the cash value, but any amount that you haven't repaid when you die reduces the death benefit.

If you end the policy, you get the cash surrender value back, which is the cash value minus fees and expenses. However, ending the policy means you no longer have life insurance and no death benefit will be paid at your death.

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References in periodicals archive ?
Most ordinary whole life insurance policies have no explicit surrender charges.
Such shareholders hopefully own whole life insurance policies on their lives that have appreciated in value.
For example, one Tampa, Florida business has used the cash value of its whole life insurance policies several times over the years, in one instance staving off mortgage foreclosure and in another, redeeming shares.
The government will allow banks Thursday to sell more insurance products, such as single-premium whole life insurance policies, over the counter.
Because the P policies were whole life insurance policies, A was allowed to borrow up to the amount of a policy's cash value during the insured employee's life.
If you're setting aside money to leave as an inheritance, first check term and whole life insurance policies, particularly if you're young.
These lawsuits arise from the sale, beginning in the late 1970s, of whole life insurance policies, whose dividends accumulate to build cash value.
Yet new data shows that seniors over age 65 lapse more than 376,000 policies each year, which collectively totals more than $88.9 billion in face value (not including the more than $23.7 billion of whole life insurance policies that are surrendered as well).
The plans do not grow cash value like whole life insurance policies do, and that means premiums on average are more than 10 times less than what they are for whole life plans that pay the same death benefit.
That obligation limits the range of asset options at a fully insured plan's disposal to guaranteed contracts at set rates of return--fixed annuities, in some cases combined with whole life insurance policies.
* Purchase of periodic premium whole life insurance policies at the earliest possible age is still one of the best hedges against unforeseen future needs than is the case with any other financial product.
Many whole life insurance policies in the marketplace offer clients the opportunity to combine base whole life coverage with term coverage via a Blended Insurance Rider to create premiums that are closer to what is possible with universal life.