Paid up Whole Life Insurance is life insurance for which no further premiums are due. If you received notice that your policy was paid up, and died in the future, your beneficiary would receive the death benefit, even though you had not paid any additional premiums from this point forward.
Paid up whole life insurance policies refer to the cash value of the plan has reached a point that the death benefit now has enough value to pay your premiums the rest of your life without any further contributions from you. In other words you have achieved free life insurance for the rest of your life. Congratulations!
President, Lane Independent Agency, Southern California
This is a type of Whole Life. The Paid up refers to the fact that the premium for your entire lifetime is paid in advance, so no further premiums will be due in the future, for your lifetime.
Whole life means that the policy also has cash value during your lifetime, meaning you can borrow against that cash value anytime you wants for anything you want. If you choose never to repay that loan, the amount is deducted from your death benefit, but you keep the money tax free on the loan. There is also Equity Indexed Universal Life you may want to consider. That policy can have living benefits, you do not have to die to use. If you become chronically sick or critically sick or terminally sick, you can access not just the cash value but the death benefit while you are living, long before your death. You could contact a Premier Financial Alliance Associate to get details on both of these programs. PFA is the largest broker for National Life Group, one of America's five oldest insurers. Thank you. GARY LANE. 714 422 9616.
Regional Marketing Director, Capital Choice Financial Group,
Whole life insurance is life insurance that includes a cash value build up in the policy that reduces the financial obligation to the company. In other words, the client is self-funding the death benefit by a portion of the premium going to the cash value. As the cash value grows the less the company has to contribute to the face amount of the policy. The difference between the face amount of the policy and the cash values is the actual amount that the company pays upon the death of the policy holder. For a cash value policy to be paid-up the cash value build up has to reach a point where it equals the face amount of the policy. This increased funding of the cash value is why paid-up policies are much more expensive than standard whole life policies. As a financial professional, I only recommend term insurance to my clients that gives them 2-3 times the protection needed while building assets through debt reduction and investments in 401ks, IRAs and mutual funds. Keeping your investments separate from your insurance is the financially sound thing to do. If you have any questions please contact me @ 843-450-9879 or visit my website @ www.hinchfinancialgroup.com.
Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
Paid-up whole life insurance is a structure established under a whole life policy where you only pay premiums for a certain amount of years or to a specified age where premiums no longer need to be paid to guarantee the coverage. Once this point is met, the coverage is guaranteed to pay proceeds upon a claim on the policy when death of the insured person occurs.
Please note, the shorter the amount of time for the policy to be paid up, the higher the required premiums. The longer the amount of time for the policy to be paid up, the lower the required premiums. Please be sure that the need for whole life coverage is present as whole life almost always the most expensive type of coverage on the market. If you're buying for purely for death benefit needs, you may want to consider a guaranteed universal life policy (GUL) to keep your premium costs down and maximize your death benefit amount.
I hope the information is helpful - please feel free to contact me for help with your coverage and if you have any other questions. Thanks very much.
That is a great question! I have a great answer - it means that there is no more cost for your coverage, it is paid off! There are a couple of ways that you have reached this great place. You might have purchased a policy that was structured to have higher premiums for a period of time, allowing the costs of the policy to be paid off more quickly than the traditional whole life policy would normally have. These policies are more expensive than the traditional whole life policy, but are perfect for someone who may be working, and not want to carry that monthly expense into retirement, yet still wants whole life coverage. For someone who wants to maximize retirement money, this may be a great financial decision.
The other way that you might have gotten here is by converting an expiring term life policy. Often when a term policy reaches a point near its end date the option to convert your premiums paid over the life of the policy to payments on that company's whole life policy that would most closely match your term policy in price. If you choose that option, then the company considers what you have paid on the term as the purchase price for a single payment on a whole life policy, and the face value is determined by that price. For example, I have a client whose $100,000 term policy allows him the option to convert it. If he chooses to do that, the premiums he would pay on the policy over the life of the term would purchase about $43,000 worth of whole life insurance that is paid up free and clear. He would have that coverage and not ever owe another penny on it.
If you have any further questions, I hope you feel free to contact me and ask, I'm happy to help. Thank you for asking your question!
Insurance Adviser - Broker, SC Insurance Services, Oahu, Hawaii
Simply put, paid up whole life insurance is a whole life policy that has been paid for in full. Some providers will allow a client to pay the entire policy premium at the outset of the policy. The biggest benefit to that is the cash value of the policy will grow at a much faster rate than when the premiums are paid incrementally.
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Whole life means that the policy also has cash value during your lifetime, meaning you can borrow against that cash value anytime you wants for anything you want. If you choose never to repay that loan, the amount is deducted from your death benefit, but you keep the money tax free on the loan. There is also Equity Indexed Universal Life you may want to consider. That policy can have living benefits, you do not have to die to use. If you become chronically sick or critically sick or terminally sick, you can access not just the cash value but the death benefit while you are living, long before your death. You could contact a Premier Financial Alliance Associate to get details on both of these programs. PFA is the largest broker for National Life Group, one of America's five oldest insurers. Thank you. GARY LANE. 714 422 9616.
Please note, the shorter the amount of time for the policy to be paid up, the higher the required premiums. The longer the amount of time for the policy to be paid up, the lower the required premiums. Please be sure that the need for whole life coverage is present as whole life almost always the most expensive type of coverage on the market. If you're buying for purely for death benefit needs, you may want to consider a guaranteed universal life policy (GUL) to keep your premium costs down and maximize your death benefit amount.
I hope the information is helpful - please feel free to contact me for help with your coverage and if you have any other questions. Thanks very much.
The other way that you might have gotten here is by converting an expiring term life policy. Often when a term policy reaches a point near its end date the option to convert your premiums paid over the life of the policy to payments on that company's whole life policy that would most closely match your term policy in price. If you choose that option, then the company considers what you have paid on the term as the purchase price for a single payment on a whole life policy, and the face value is determined by that price. For example, I have a client whose $100,000 term policy allows him the option to convert it. If he chooses to do that, the premiums he would pay on the policy over the life of the term would purchase about $43,000 worth of whole life insurance that is paid up free and clear. He would have that coverage and not ever owe another penny on it.
If you have any further questions, I hope you feel free to contact me and ask, I'm happy to help. Thank you for asking your question!