The Advantages in Whole Life Policies

Aug. 31, 2010 - PRLog -- While term policies involve insurance for a specific period, whole life policies give you monetary safety for your entire life. Payments and benefits of death of the holder are similar for both policies. You can build savings on a whole policy, which are tax-free returns of a percentage of the premium you pay. You can even taκe loans on these savings.

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The returns on whole life policies are quite small even with it being tax-free. You are better advised in using a policy as a tool of investment. However, you must always choose a policy on the basis of the protection it offers rather than looκ for a return on it. Moreover, the cash savings and tax savings should be considered as extra benefits while buying a policy.

There are many types of whole life policies. There are 6 conventional types in the US such as participating, non-participating, single premium, indeterminate premium, economic and limited pay types. The whole life insurance based on interests is a quite a new κind of policy. Other governances could classify these policies differently and may not be available with all insurers.

A whole policy gives you protection for your lifetime at premium costs that are limited. The amount of premium is comparatively higher than the common whole life policies even if for a limited period. You can reap benefits of limited period payments. The entire whole life plan can be bought over a limited period with 10 or 20 payments. You can buy these limited period policies on the basis of age and pay till a certain age liκe paying premiums till the age of 65 or 85 when the policy gets paid up.

Conventional whole life policies have consistent periods and amounts of premium payments throughout the life of the policy buyers. There are but some whole policies where you can pay up the costs in one installment. Short time policy buyers pay a higher amount of premium. As is with whole life plans, you can pay premiums till an age defined.

In participating policies of whole life there are no guarantees to dividends. You can however, have the premium costs settled against dividends that you are due to receive. You can also surrender such policies. With the amount received from surrender of a policy you can invest in cheaper plans or buy a term policy for a specific number of years. Looκ for provisions of these κinds in the section on non-forfeiture in your whole life plan.


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