When you buy participating or whole life insurance, this option offers a growth strategy for your money, tax-free (within legislative boundaries) over time called “cash value” and allows you to use your policy’s cash value while still living. As long as you pay your premiums, your coverage will last a lifetime. You are also eligible to receive policyholder dividends. You can use them to purchase more coverage, lower your premium payment, or take them out as cash. Just remember you may have to pay tax on any withdrawals.
How Does It Work?
Simply put, when the account performs well, you may be eligible to receive policyholder dividends. The premiums you pay for your life insurance go into the participating account.
Asset managers invest your share in the account with the sole intention of managing risk and increasing its value. These assets are used to pay the policy benefits – including death benefits – when it comes time.
Who Does It Benefit?
Having participating life insurance guarantees protection for you and your family for life – you just need to pay your premiums. Whereas term life insurance is only for a specific time period. The policyholder dividends also gives you the option to increase your coverage or alter your premiums all the while protecting more of your money from taxes while you are still alive.
Watch Your Wealth Grow
Having participating life insurance can give you the help you need to reach your financial goals. This is done via the growth of tax-advantaged cash value. Whatever your need is; supplementing your retirement income, your children’s education or starting your life-long dream as a business owner, participating life insurance can help.