FAQ: Who Benefits from Permanent Life Insurance?
It’s important that you plan for your retirement, and it’s important that you make contingency plans for your loved ones should you suddenly die. No one with a spouse or domestic partner and children – especially young ones – likes to think of them as financially unprepared if we pass away. One strategy that covers your concerns regarding retirement and the fate of your loved ones without you is permanent life insurance. Permanent life insurance, also known as whole life insurance, benefits you, the policyholder, by giving you peace of mind knowing that your loved ones will be provided for. It also gives you peace of mind knowing that you are putting money aside, in the form of permanent life insurance premiums, for your retirement.
Fortunately, in most instances permanent life insurance benefits you the policyholder, the most. That’s because statistics show that you will most likely live to your retirement age. Once you get there, you can start accessing the cash value component of your permanent life insurance policy. Now that you are no longer working, you need to have some other form of income, and permanent life insurance payments, called annuities, do just that. You can access the money you put into your permanent life insurance policy earlier than your retirement, but whether you can or not will depend on your individual policy.
Of course, other parties who benefit from permanent life insurance are the people you name as beneficiaries. If you are married to a wonderful person and the two of you have three young children, and you suffer a fatal accident, they will all receive the death benefit from your permanent life insurance policy. In general, the bigger the death benefit payout, the more you pay in premiums.
To learn more about who benefits from permanent life insurance, death benefits, annuities, pay outs, premiums or any other aspect of permanent life insurance, be sure to consult with a life insurance expert.