Whole Life Coverage

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Whole Life Coverage Also known as whole of life assurance, sometimes called "straight life" or "ordinary life", is a life insurance policy which is guaranteed to remain in force for the insured's entire lifetime, provided required premiums are paid, or to the maturity date. This is contrary to term life insurance that provides coverage for a set period of time, such as 20 years. Whole life insurance guarantees payment of a death benefit to beneficiaries in exchange for level, regularly-due premium payments. The policy includes a savings portion, called the “cash value,” alongside the death benefit. In the savings component, interest may accumulate on a tax-deferred basis. How whole life policy works is very simple; a permanent policy that builds cash value over time. As long as the premiums are current, the policy remains active for the entire life of the policyholder, and beneficiaries will receive a set death benefit upon the insured's death. For an investment standpoint whole life insurance is generally not a good investment unless you need permanent life insurance coverage. If you want lifelong coverage, whole life insurance might be a worthwhile investment if you have already maxed out your retirement accounts and have a diversified portfolio(s). The cost of a whole life insurance policy depends on several factors, including how much coverage you buy and other things. When it comes to paying your premiums, you'll typically be able to make a fixed annual payment for a whole life insurance policy. Some life insurance companies may also offer the option to pay monthly, quarterly or twice a year. Be aware, however, that paying premiums more frequently than once per year may incur additional fees. While there are other types of permanent life insurance, whole life is the simplest: -The premium remains the same for life. -The death benefit is guaranteed. -The cash value grows at a guaranteed rate. The main disadvantage of whole life is that you will likely pay higher premiums. Also, you are likely to earn less interest on whole life insurance than other types of investments. #benewinsurance #insurtech #inclusiveinsurance #insurance #reinsurance #takaful

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