Pros and Cons to Whole Life Insurance
Life used to be steady-paced and predictable however, all the latest advancements in technology, affecting almost every sphere of a persons life, have turned the average persons life up-side down, thrusting himher into a fast-paced society at break-neck speed. Having a life insurance policy that not only meets your needs, but caters to your preferences and wishes, is a must in our contemporary society. It is a critical form of personal security, as well as a safeguard for your family should an untimely accident occur. Whole life policy is one such insurance that not only offers the insurer indemnity policies, but also factors an investment element into the bargain.
Like everything in life, there are two sides to the coin advantages and disadvantages. The purpose of this article is to provide you with whole life insurance pros and cons so that you can make an informative decision. One of the primary benefits of this policy is that as long as the insurer is faithful and consistent to pay hisher premium fees, the policy lasts indefinitely, unless canceled prematurely. This is especially ideal for persons who desire a to leave a substantial amount of money (when they die) to their beneficiaries. Another pro of whole life insurance is that there is a mandatory saving component (as most people find it difficult to voluntarily, consistently set aside savings), which forces insurers to save by paying higher monthly premiums. This way, over time, the insurer is able to accumulate substantial savings, which is he not allowed to touch until the agreed upon time. Additionally, insurers who own real estate and are worried about tax issues should know that this policy offers tax-free death benefits, combines total cash value with the value of the property, and allows the insurer to get a loan against that value.
There are also some notable disadvantages to whole life insurance policies they quite costly and offer less coverage per premium than a term policy. The policys cash value is below the premiums for at least 10 to 15 years. Lastly, many people find whole life policies to be complicated and tricky to understand, and need the help of an agent (another cost) to help them find which policy best suits their needs.
Like everything in life, there are two sides to the coin advantages and disadvantages. The purpose of this article is to provide you with whole life insurance pros and cons so that you can make an informative decision. One of the primary benefits of this policy is that as long as the insurer is faithful and consistent to pay hisher premium fees, the policy lasts indefinitely, unless canceled prematurely. This is especially ideal for persons who desire a to leave a substantial amount of money (when they die) to their beneficiaries. Another pro of whole life insurance is that there is a mandatory saving component (as most people find it difficult to voluntarily, consistently set aside savings), which forces insurers to save by paying higher monthly premiums. This way, over time, the insurer is able to accumulate substantial savings, which is he not allowed to touch until the agreed upon time. Additionally, insurers who own real estate and are worried about tax issues should know that this policy offers tax-free death benefits, combines total cash value with the value of the property, and allows the insurer to get a loan against that value.
There are also some notable disadvantages to whole life insurance policies they quite costly and offer less coverage per premium than a term policy. The policys cash value is below the premiums for at least 10 to 15 years. Lastly, many people find whole life policies to be complicated and tricky to understand, and need the help of an agent (another cost) to help them find which policy best suits their needs.
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