What Is Whole Life Insurance And Is It Right For You?
Dean Shainin

If you are considering whole life insurance it is a very good idea to know the aspects of whole insurance and if it’s the right type of life insurance for you.

Whole life insurance is so named because it’s designed to stay in force throughout your life. In other words your “whole life.” In the first few years, when you’re young, its cost will be low, so the bulk of the money goes to pay the agent and into an investment account. As you get older, the cost of insuring you increases, so less of your premium goes into the investment account. The money that goes into the account in the early years is able to grow. The cash value of your whole life policy is the amount you’d get if you decide to surrender it.

Compared to the other types of permanent insurance, whole life insurance is closer to the sure thing. Premiums are guaranteed throughout the life of the policy and so is your death benefit, though the cash value of the policy will vary with the insurance company’s investment performance. In most cases, insurers invest the money that’s building you cash value fairly conservatively. This enables them to try to keep up with the numbers you saw in a policy illustration. However, it also means that returns under perform other investments, such as stocks or equity mutual funds.

With whole life insurance it can take some time to accrue any real cash value. You need to stick with it for about ten years. It can take closer to twenty years before the gain begins to look impressive. So beware of any insurance agent who tries to convince you to swap one whole life insurance policy for another so called “better” policy just a few years after you made your original purchase. Not only will you rarely have earned any cash value to speak of, but you may face high surrender charges for dropping the first whole life insurance policy. What the agent may be trying to do is to keep his or her hefty commission checks rolling in.

6 Important Aspects To Consider With Whole Life Insurance Policies

1. Commissions and expenses should be considered to see the true costs.

2. Cash value should always be considered to get a fair comparison.

3. Dividends and interest are very important.

4. The ability to adjust the death benefit so you have flexiblity.

5. The ability to adjust the amount and timing of premiums is a very important aspect.

6. Interest rates should be compared and considered.

4 Important Questions To Ask The Life Insurance Company

There are several questions you should ask an agent before you sign up for a whole life insurance policy. These are just a few common questions to ask and some you may want to research yourself.

1. How much coverage do I need and is it enough for my financial needs?

2. What type of insurance is best for me, whole life or term?

3. How can I get a discount on my life insurance policy from companies agents?

4. What is your Standard & Poor’s ratings of the whole life insurance company?

With fast online Internet access and the many web sites available, you can easily compare and get quotes from several whole life insurance companies in a single day. Be sure to be honest with the health questions that you answer to get an accurate quote.

Dean Shainin is a well known writer of http://www.MyWisdomBase.com a directory designed to provide current information, resources, tips, services and state of the art products.