Whole Life Insurance Cash Value

Having a lifetime of financial protection: That’s certainly the goal when deciding to buy whole life insurance.  With whole life insurance you are guaranteed coverage from the day you buy the policy through the rest of your life, as long as the premiums are paid – which adds up to greater peace of mind. However, whole life insurance has another benefit that’s another big plus: cash value.

What is “Cash Value”?
After the initial policy years, each time that you make a premium payment for your whole life insurance policy, the insurance company sets aside a small portion. Over time, the amount grows and becomes the policy’s accumulated cash value. The longer you hold the policy, the larger the cash value. 

How Can I Benefit from the Cash Value of a Whole Life policy?
The cash value of a whole life policy can be used in several ways and could help during life’s ups and downs.

For example, if something unexpected came up, you could turn in the policy and receive the cash value, or you could borrow against the cash value* and still keep your policy. In some cases, you might be able to apply the available cash value to pay your policy’s monthly premium. If you decide to take out a loan against the cash value, you could choose to pay back the loan with interest, or, upon your death, to have the amount of the debt deducted from the payout money that your beneficiary would receive.

*Policy loan interest rate is 8%. Loans may impact cash value and death benefit.

How much Is the Cash Value?
How much it can grow depends on how long you’ve owned the policy, your age when you bought the policy, the policy’s coverage amount, and whether there’s any outstanding debt from loans against the policy. The cash value will usually be greater in the later years of a policy since cash value accumulates over time.

Who Can Access the Cash Value?
As a policy owner, you can access the available cash value of your whole life insurance policy at any time.