Whole Life Insurance

Premiums, Death Benefit, Steady Cash Value Growth: This refers to the core features of a whole life insurance policy. The policyholder pays premiums, usually on a regular basis, to maintain coverage. The death benefit is a guaranteed sum paid to beneficiaries upon the policyholder's death. Steady cash value growth means that part of the premium contributes to a savings component, which grows over time, typically at a fixed rate. 

Cash Value: A portion of the premium paid into a whole life insurance policy contributes to a cash value account. This cash value grows tax-deferred at a guaranteed rate set by the insurance company. Policyholders can withdraw from, take loans against, or surrender their policy for the cash value. However, these actions may reduce the policy's death benefit.

Living Benefits: Many whole life insurance policies offer additional features that allow the policyholder to access a portion of the death benefit under certain circumstances before death, such as in cases of chronic or terminal illness. This can provide financial support during difficult times.

Death Benefits: The death benefit is a guaranteed amount that beneficiaries receive upon the policyholder's death. Typically, this amount does not include the accumulated cash value unless the policy includes an additional rider that specifies otherwise.

Dividends: Participating whole life insurance policies, typically offered by mutual insurance companies, may pay dividends. These dividends are not guaranteed but can be used in various ways, such as to reduce premiums, accumulate additional cash value, or purchase additional insurance.

Cost: The cost of a whole life insurance policy depends on several factors, including the policyholder's age, gender, health, lifestyle, and the amount of coverage they choose.

Choosing a Policy: When selecting a whole life insurance policy, important considerations include the insurance company's history of paying dividends, its financial strength, and the specific costs associated with the policy. It's crucial to understand that the premium is not the only cost involved in maintaining a policy.