Whole life is one form of permanent insurance. The other major form is universal life. Whole life is the simplest and most traditional form of it. There are non-forfeiture options on most policies that will even allow permanent coverage if you cannot afford the premiums anymore.
The two major types of life insurance are Permanent and Term. Whole Life falls under the Permanent Category. Term life insurance gets its name because the premium stays the same for a period of years. Whole life insurance gets its name because the premium stays the same for your whole life. Whole life also has options where you can pay for a shorter period of time, and still have coverage for your whole life.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
A whole life policy is one of many “permanent life insurance” plans. The whole life policy is one where the premiums and death benefit are guaranteed not to change throughout the lifetime of the insured. There are policies that limit the premium paying period; there are some that allow a “flexible” premium paying schedule and some that offer a link to investment outcomes.
President, The Firm of Steven H. Kobrin, LUTCF, 6-05 Saddle River Rd #103, Fair Lawn, NJ 07410
Yes. Whole life is a permanent life insurance. The premium and the death benefit can be guaranteed for your entire lifetime.
So can the cash value. This makes the product an extremely competitive cash accumulation vehicle for the conservative part of your portfolio.
And why would you want the premium and the death benefit to be permanently guaranteed?
Well, imagine yourself buying term insurance and then outliving the policy. Now you need to buy another one. And you’re older, so the price is automatically higher.
And what if you unfortunately have a serious medical condition? The price could be even higher. Worse, you may not qualify for coverage at all!
Permanent insurance means you permanently don’t have to worry about qualifying for coverage.
Whole life does that very well. But remember this: these guarantees come at a big cost. Especially the guaranteed cash value.
What if you like the idea of permanent guarantees, but want to spend less on the coverage?
You do have an option: guaranteed universal life insurance. You can get the premium and the death benefit guaranteed for your lifetime – at least until age 121:). You just won’t have any cash guaranteed to grow inside the policy.
Guaranteed universal life is also permanent insurance. It’s a cheaper version of whole life, without the cash. Kind of like “permanent term insurance.”
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Is whole life insurance the same as permanent life insurance? Well, for the most part yes, the names are somewhat interchangeable when talking about long term coverage. However, there are other products if structured properly can also meet the definition of permanent life insurance. There permanence depends on proper funding of those products in such a way that they mimic whole life plans.
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So can the cash value. This makes the product an extremely competitive cash accumulation vehicle for the conservative part of your portfolio.
And why would you want the premium and the death benefit to be permanently guaranteed?
Well, imagine yourself buying term insurance and then outliving the policy. Now you need to buy another one. And you’re older, so the price is automatically higher.
And what if you unfortunately have a serious medical condition? The price could be even higher. Worse, you may not qualify for coverage at all!
Permanent insurance means you permanently don’t have to worry about qualifying for coverage.
Whole life does that very well. But remember this: these guarantees come at a big cost. Especially the guaranteed cash value.
What if you like the idea of permanent guarantees, but want to spend less on the coverage?
You do have an option: guaranteed universal life insurance. You can get the premium and the death benefit guaranteed for your lifetime – at least until age 121:). You just won’t have any cash guaranteed to grow inside the policy.
Guaranteed universal life is also permanent insurance. It’s a cheaper version of whole life, without the cash. Kind of like “permanent term insurance.”