Ever thought you don’t need life insurance? Maybe you need to think again. It is true that thinking about one’s death is not pleasant, but it’s also important to ensure that people you love can have what they want after you’re gone. This is what whole life insurance is designed to achieve. It is the most popular form of permanent life insurance. This means you don’t have to worry about the expiration of the coverage.
Another form of life insurance is term life insurance, but the main difference is how long the policy lasts. Term life insurance only lasts for a period (the term). For instance, if you purchase a 20-year policy and you don’t pass away by the end of that term, it expires and your family would get nothing. But you can also convert your term insurance to whole life insurance at the end of the term.
Generally, getting whole life insurance is costlier than term life insurance, but it is worth it. Your insurance remains as long as you keep paying premiums. Additionally, some of your payments accumulate as cash value, which can be used to supplement your retirement income.
With permanent life insurance, even if you stop paying premiums, you can still use some of the money you paid after a while. This is referred to as the policy’s cash value. Also, your returns are guaranteed.
Many retired people usually express frustration after making payments on term life insurance policy for years and it is eventually terminated because of the unaffordable renewal rates. For this reason, it is better to opt for the whole life policy.
Once the permanent life coverage has been issued, it cannot be canceled, revoked, or reduced except in cases of fraud or nonpayment. This makes it appealing as it provides a level of certainty and confidence. The rate you pay to keep it on is constant and never increases.
Even though whole life insurance could cost about six times the amount of term life insurance, you still have to balance the benefits. The choice is usually affected by reasons like your age, finances, or how long you want it to cover.
If you have people depending on you, it is better to go for the whole life insurance policy. It is the only policy that guarantees covering the needs of your dependents after you’re gone.