Whole life insurance

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Related to Whole Life Policy: Endowment policy

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.

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.

whole life insurance

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.

References in periodicals archive ?
Having a whole life policy with a chronic care rider allows people to lessen the financial burdens of chronic care situations.
* A single-pay, paid-up whole life policy at the attained age; or
A whole life policy that participates in the investment experience of the issuing company generates an annual dividend, which is defined as a partial return of premium, and this is how producers like Leggett use it to the advantage of younger clients.
* In a whole life policy, the net cash value (for whole life contracts where there is no separately stated surrender charge).
And if, later in life, Jim decides he wants to live a slightly richer retirement, he can take dividends off his whole life policy.
A higher percentage of term policies (without a renewal rider) may be associated with a lower lapse rate, given that the expiration of non-renewal term policies is not regarded as lapsation; in contrast, the cancellation of a whole life policy is reported as a lapse.
Many companies pay 55% first year commissions when the plan of insurance is similar to an ordinary whole life policy. They will typically pay somewhat lower rates on low premium and high premium plans.
This will translate into a cut in premium payment of about 100,000 yen for a whole life policy that requires 9 million yen in premium payment at the age of 50 for death coverage of 12 million yen, the sources said.
The ultimate limited-payment policy is the "single premium whole life policy" which is discussed in more detail below.
Commonly used for estate and business planning, a whole life policy is desirable where a guaranteed death benefit and a guaranteed level premium are important.
When people start talking about investments in the same breath as "life insurance," they typically mean some type of cash value or whole life policy that combines straight insurance protection with an investment account that may be invested, for example, in mutual funds.