Thanks to three guaranteed components* - premium, cash value and death benefit.
Of course, Whole Life will help replace your income to protect your family or your business in the event of your death. But thanks to the cash value within the policy, it can also help accumulate wealth, give you access to cash to cover unexpected expenses, augment your retirement income, facilitate estate planning, and more. All at a predictable cost on account of the guaranteed policy premium.
Unlike Term Life Insurance - which, as its name suggests, is in effect for a limited period or “term” - Whole Life is permanent insurance. That means it will provide benefits for the duration of your life.
Whole Life protects your family or your business by offering a permanent death benefit that can fulfill a broad range of financial needs.
For your family:
For your business:
One of the greatest advantages of Whole Life is its ability to increase in value over time. The cash value of a Whole Life policy can grow thanks to the guaranteed cash value and the potential to accumulate dividends. But unlike other types of investments and savings vehicles, the cash value and dividends of a Whole Life policy generally grow tax-deferred for as long as the funds remain in the policy.
Access to Cash Value
At any time, for any reason, you can access the cash value you’ve accumulated — generally with no penalty or tax liabilities. You can use the cash value in a Whole Life policy to:
It is important to note that accessing the policy cash value through loans and surrenders may cause a permanent reduction of policy cash values and death benefit and, depending on the policy, negate any guarantees against lapse. The amount that can be borrowed or surrendered will be affected by the surrender charges applicable to the policy. Loans may be subject to interest charges. Although loans are generally not taxable, there may be tax consequences if the policy lapses or is surrendered with a loan. It is possible that the amount of taxable income generated at the lapse or surrender of a policy with a loan may exceed the actual amount of cash received. Surrenders are generally taxable to the extent they exceed basis in the policy.
Whole Life Insurance offers a host of unique tax advantages. These can help minimize the impact of taxes on both the death benefit and cash value of your policy.
* Guarantees are based on the claims paying ability of the issuing company.** The payment of dividends is not guaranteed. Companies may reduce or eliminate the payment of dividends at any given time. *** Neither Kaplan Financial nor LPL Financial provide tax advice.
Before you purchase, be sure to ask your financial advisor about the life insurance policy’s features, benefits, risks and fees, and whether the life insurance is appropriate for you, based upon your financial situation and objectives.