Single Premium Whole Life Insurance

There are so many different kinds of permanent life insurance policies from which to choose. Your choices include single premium payments, participating, non-participating, limited pay whole life insurance, economic, and indeterminate premiums. Some of these payment plans are fixed-rate, which means you pay the same amount month after month. Economic and indeterminate premiums depend on several factors, but the premium amount varies every month or every year. You will have to perform research and compare quotes and rates from this site.

Single Premium Definition

A single premium life insurance policy is when you pay off your never ending life insurance policy in one lump sum. You and your agent will determine the basics of the policy: the face value, cash value, premium amount, etc. Your agent will tell you how much you need to pay to fulfill the obligations of the policy and reap the full benefits. This is the "single premium" you must pay to get coverage. The amount will be thousands of dollars, but you only have to pay it once and then never again. It is a good payment plan for an older person who wants to make sure his family gets full coverage. However, if the policy holder decides to cash in the policy before he dies, he will have to pay extra fees.

Single Premium Advantages

There are pros and cons that come with a single premium whole life insurance policy. On one hand, the policy holder will feel more secure knowing that the life insurance policy is paid off in full. With a single premium whole life insurance policy, the policy holder also gets the benefit of a cash value account. The cash value can accumulate interest or dividends over the years and the family members can use the account to get loans. However, the single premium amount is substantial, so he should make sure he can afford it first. Also, the policy holder should be 100% confident that he will not cancel the policy during his lifetime. Doing so will incur high fees.

Single premium whole life insurance policies are an attractive choice for many individuals if they meet certain qualifications. One qualification could be if you have any dependents. Dependents could be children of any age or a spouse. It could also be an elderly parent or sibling. If they rely on your income, they are dependents. If you are in good health and think you could outlive a term policy, you may consider a single premium whole life insurance policy. The cash value is another incentive.

Life Insurance Riders

You also have the choice of adding riders to your single premium whole life insurance policy. A rider is an extra feature. A rider might include an accidental death benefit policy, which pays your beneficiaries money if you have a fatal accident. Another type of rider is a disability or long term care rider, in which the company will pay you money if you become disabled. A policy purchase option lets you buy more insurance without having to re-qualify all over again. These riders cost extra money, so consult with your insurance agent to see if you might benefit from adding riders to your policy.

Whole life insurance means you will never outlive your policy, which is an advantage to your beneficiaries. They will be assured of getting the full face value of the policy. A single lump premium can give you this kind of peace of mind. You will never have to deal with bills in the mail or worry about how to pay a bill. Your senior years will be spent having fun and enjoying yourself with your family.