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 ?
In addition to valuable death benefit protection (if properly structured) and if the client's needs change, withdrawals from a whole life policy can provide tax-free income in retirement.
A whole life policy at the original issue age when the SPO rider was purchased.
5 million in coverage, he might recommend a $1 million whole life policy and the rest in 15-year and 30-year level premium term policies, which can be terminated when there is no longer a need for the coverage.
On a whole life policy there was 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.
Due to the lower dividend, however, a whole life policy may need to be paid for many more years than originally illustrated.
Cash value buildup is fastest for a single premium whole life policy and slowest for a "continuous-pay" (level premium over life) policy.
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.
The second is a Whole Life Policy that has no fixed finishing date, but the premiums on these are not guaranteed.
True 66%--if you cancel a whole life policy after just a few years your life insurance costs can double.
Now we're told it's a whole life policy which pays out only on death.