Whole Life Insurance

Whole life insurance is also known as "traditional, straight, or permanent" life insurance. A whole life insurance policy is a policy that will be kept active for the length of a person's whole life as long as the premiums continue to be paid in full. A whole insurance policy can be a good value because they accrue a cash value. This means hat you get some savings at the same time as you get life insurance. Some life insurance companies will even pay a dividend to you if the life insurance company is profitable. This means that the premiums will be paid back to you in the form of dividends. You can then use the dividends that you earn to offset some of your premium payments and you can purchase more insurance. Or you may want to buy additional term life insurance as even more security. Whole Life insurance will provide you with life insurance coverage for the entire lifetime that you're insured. No matter long you have the life insurance policy, or how much you've paid in premiums, the life insurance policy will be kept active. You can pay premiums throughout your life or for a portion your life, such as for 10 or 20 years. As well, premiums may be paid in one lump when the policy is taken out. The cash value of your whole insurance policy belongs to you and you can take out any money as a loan at any time or when the policy is cashed in. When it comes to whole life insurance part of the premium that you pay goes towards the insurance part of the life insurance policy and part of the premiums that you pay will go toward administrative expenses that the life insurance company incurs. The rest of the premium that you pay goes toward the investment or cash portion of the life insurance policy. The investment part of the whole life insurance policy will usually consist of stocks, bonds, and mutual funds. Any interest that is drawn on the investment of a whole life insurance policy is usually tax-free until the time that you tax it out of the investment. Universal life insurance is one variation of whole life insurance that you may encounter as you're shopping around for life insurance.

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