5 Benefits of Cash Value Life Insurance
The most useful life insurance policy will be one that matches your needs. Having said that, people sure do have a lot of unique needs! That’s why the insurance market has responded by creating so many different types of life insurance policies. Yes, it can be a bit confusing to sort through all of your options, but doing so will help to ensure that you end up with a policy that is a good fit for your needs.
A cash value life insurance policy builds cash value as you pay the premiums each month (hence the name). Like other life insurance policies, it will pay out a benefit to your survivors in the event that something happens to you. But because a portion of each month’s premium is diverted into savings or investments, you can use this type of life insurance policy to accomplish other goals, such as…
Take a withdrawal. In the event of a sudden emergency, or you just need cash for a major purchase, you can take a withdrawal from your cash value life insurance policy. Do remember that your eventual death benefit will be smaller as a result, but sometimes we need access to funds for other major moments in life.
Take a loan against it. If you don’t want to actually remove cash from your life insurance policy, you can take out a loan against the value of the account. However, you must repay these funds, plus interest, or else the death benefit will be reduced.
Keep the premiums covered. In the event that you suffer a hardship, such as job loss, you can use the cash value part of the policy to continue paying the premiums. This way you don’t lose the policy during hard times.
Sell it. Believe it or not, you can actually sell your cash value life insurance policy! This isn’t necessarily the right decision for everyone, but there are benefits to selling in some situations.
Surrender. In the event that you need all of the cash accrued in the policy, you can actually surrender it.
A cash value life insurance policy is just one of many types of life insurance on the market, and can provide for a variety of unique needs. But before you make a decision, consult with us about all of the options available to you. We can help match you to a life insurance product that meets your expectations.