Whole life insurance guarantees a minimum death benefit for your entire life, as long as all premiums are paid. Premiums are fixed for the entire length of the insurance plan. You are guaranteed the policy?s minimum cash value and a minimum death benefit.
Whole Life Insurance has several benefits. The fixed premiums are understood upfront and easily become a disciplined routine, making them less easy to skip, which could cause future problems. With the fixed premiums, it is easier to plan ahead financially even years into the future. Although they are not guaranteed, dividends can be applied to whole life insurance to reduce your overall costs. But above all, the relative security that comes from having a full life insurance plan is a huge advantage to whole life insurance over the term.
There are some factors you may want to further consider about whole life insurance. First, whole life insurance is fixed. The face value on your policy does not change and therefore, if you decide later you want more coverage, you will need to purchase another policy with supplementary costs. There is no investment flexibility with a whole life insurance plan and limited growth potential. Your coverage is decided at your policy?s inception and will basically remain unchanged throughout your entire life.
If you are looking for a more lasting insurance plan than term insurance, consider whole life insurance, which provides you with full life insurance and financial protection in the event of death.