When Can You Borrow From Life Insurance?

1. 

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   David G. Pipes, CLU®, RICP®

   Business Development Officer, T.D. McNeil Insurance Services, Fresno, California

   A beauty of cash value life insurance is that you don’t ever have to give a reason to borrow money on the policy.  Your agent doesn’t hold the funds so the process includes a form to be sent to the home office.  The process may take a few days, but the funds should be released right away.  The policy might restrict the percentage of the cash value that is available for loans. 

   Answered on March 18, 2014

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2. 

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   Tim Wilhoit

   Owner, Your Friend 4 Life, Brentwood TN

   First off be sure you have the type of policy with cash value in order to borrow the money. It must be either a whole life or universal life insurance policy. Term life insurance policies do not have a cash value, therefore nothing to borrow from. If you do have a permanent policy you must have paid in enough premiums to build a cash value. The typical plan takes 4 to 7 years to build cash value. If all is the case, just call the insurance carrier and ask for a loan form and enjoy the cash.

   Answered on December 12, 2014

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