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What Are The Advantages Of Permanent Insurance?
Home » Insurance » Life Insurance » What Are The Advantages Of Permanent Insurance?Permanent insurance provides lifelong protection as long as you pay the premiums. These policies are designed and priced for you to keep over a long period of time.
Another key characteristic of permanent insurance is a feature known as cash value or cash-surrender value. Permanent insurance is often referred to as cash value insurance because these types of policies can build cash value over time, as well as provide a death benefit to your beneficiaries.
Cash values accumulate on a tax-deferred basis just like assets in most retirement and tuition savings plans. You can borrow the cash value for any purpose you wish. When you borrow money from a permanent insurance policy, you're using the policy's cash value as collateral and the borrowing rates tend to be relatively low. Unlike loans from most financial institutions, the loan is not dependent on credit checks or other restrictions. You must repay any loan with interest or your beneficiaries will receive a reduced death benefit and cash surrender value.
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