Permanent life insurance, unlike the term insurance, offers death benefits and cash value in return of the premiums you pay, from the time you buy the policy till you pass away. The death benefit is the money paid to your beneficiaries on your death. The essential feature of permanent life insurance is the cash value component which is a kind of savings that you can access while you are still alive. If for any reason, you cancel this life insurance, you become eligible to get the accrued cash value. The premium for permanent life insurance is generally costlier than for term life, but it usually does not increase as you age. Under certain circumstances, you can even borrow money tax-free from your permanent life policy. Determining which policy suits best with your lifestyle and life goals is a vital task, best performed with the assistance of an experienced insurance agent. Another advantage of retaining permanent life insurance is that the investment earnings are completely tax-free and no taxes on the death benefit are to be paid by the beneficiaries when it is eventually paid out.
Decide from four types of permanent life insurances:
With a fixed premium, this type of permanent life insurance is considered to be more stable and promises a guaranteed growth of cash value through the investment period.
Index Universal Life:
This policy under the permanent life insurance umbrella offers flexible premium payment options by allowing you to adjust your premium as long as you meet the predetermined minimum and maximum amounts. It is also easier to adjust the death benefit in this case, depending on the coverage that you want.
The variable life, permanent life insurance can be explored if you wish to extend your investment options to stocks, bonds and mutual funds while enjoying the benefits of regular permanent life insurance. We highly recommend this alternative for someone who wishes to manage regular investments.
As this policy combines the benefits of universal life with variable life in a single policy, the variable universal insurance offers enhanced investment features of variable life with the flexibility of universal life insurance.