Whole Life Insurance Policies

There are many different kinds of whole life insurance policies out there, and you might be confused with all the different types out there. Listed below are 3 different types of whole life polices that you may want to consider. These policies remain in force for your entire life, and will require that you continue to pay the premiums until the day you die.

Limited Pay

This kind of policy will normally cost more up front, but may require you to actually pay less into it in the long run. A limited pay whole life insurance policy has a pay schedule for a fixed number of year. So, you may generally only pay into the policy for 15 – 25 years, depending on your contract at the time.

However, unlike most policies, this one will still insure you for your whole life, even after you stopped paying into it.

Single Premium

This is a lot like a limited pay policy, however, instead of paying into it for a predetermined amount of years, you will pay a larger lump sum up front instead. Hence the name, “single premium”.

However, if you choose to cash in on this policy early, then there might be some rather large fees associated with that. This is usually all laid out in the policy contract before you sign.

Interest Sensitive

This is a new concept when it comes to insurance. It mixes 2 different kinds of policy types together; Universal and Whole. Since it is still apart of whole insurance, the death benefit is still guaranteed not to go down.

But the cash value is another story, it will be based on the current market value, and the variable interest rate set by the insurer. This will also vary your policy premium, but never more than the agreed upon maximum amount.