Whole Life Insurance, also known as ordinary life, whole of life insurance, sometimes referred to as “normal life,” is a permanent insurance plan that is guaranteed to stay in place for the insured's whole lifetime, whether required premiums are met or not. The term “life insurance” refers to insurance policies that pay out cash value to cover death benefits to beneficiaries during one's lifetime.
Whole Life Insurance was designed to provide financial protection for people who have little money and depend on their employers to help them get by. It pays out on the death of the policyholder after a period of time specified by the insurer. If the policyholder were to die before the period is over, the cash value of the policy would go to an estate or other plan the insurance company provides.
Whole Life Insurance is very common these days. It is considered the best investment a person can make, as it is much cheaper than term life or Universal Life policies. The cost of whole life plans is much less than the monthly premiums of other insurance plans. Most people think of Whole Life plans as an essential piece of coverage, but it is important to realize that this is far from being the only type available.
Whole Life Insurance provides coverage to the beneficiary's children, spouses and dependents when the policyholder dies. It covers the insured for his or her lifetime, so if the policyholder has any dependents, they are covered. Whole Life insurance pays out a set amount of money to the family of the policyholder upon the policyholder's death, usually in the form of a lump sum, annuity or a monthly amount. If the insured had any health conditions or illness at any point in his or her life, they are covered too.
Whole Life Insurance, unlike Term Life Insurance, does not allow the insured to borrow money against the policy. The insurance company pays out money to the beneficiary if the insured does not pass away within the defined period. Whole Life Insurance also comes with a higher deductible than a normal insurance plan, and premium payments are based on the insured's age and health and current health condition. Most policies also allow a person to borrow money for up to the policy's policy period, after which the amount borrowed is returned without interest.
There are several insurance companies that offer whole life plans. A Whole Life Insurance Broker can recommend the right plan to meet the needs of their clients. A Whole Life Insurance Guide can provide information on the different types of Whole Life plans and how to choose the right one.