First, Whole Life is a general term. When we talk whole life with our clients, we use the term “permanent”. This more accurately describes what clients are most often looking for. Be aware; whole life does not always mean permanent coverage.
Now, with that being said…
There are many choices when shopping for life insurance different policies to choose from. Many factors go into the decision process; number of dependents, needs and budgets, income replacement, funeral costs, etc. There is a life insurance policy that can fit every need and our job is to help you find the policy that will adequately cover you and those you seek to protect.
In your search for life insurance, you may have come across whole life insurance. The most common question is “How does whole life insurance work, specifically compared to term life?” First, whole life insurance is a type of permanent life insurance whereby if the policy is designed correctly, the insured will be covered by their policy for the remainder of their life. This is unlike term life insurance where the insured chooses a specific term and must die within that term for their beneficiaries to be paid the death benefit.
Another important feature of a whole life policy to consider is that a whole life policy builds cash value over time. As an example, if the insured lives to be 100 years old, their insurance provider will actually pay them the cash value of their policy. Certainly, this should not be the main motivation to buy a whole life policy but is it important to know how the policy works as it relates to the cash value feature