Best Whole Life Insurance Companies

It is a unique combination of protection and savings at a very economical premium. Death at any time before age 85 years terminates the payment of premiums and the sum insured and attached bonuses become payable. In the event the insured survives to the policy anniversary at age 85 years, the policy matures and the sum insured plus bonuses becomes payable.

Under this plan, the rates of bonuses are usually much higher than the other plans and they help increase the policy’s protection and investment element substantially. Click here for supplementary covers which can be attached to this plan.

This plan is best suited for youngsters who are in the initial stages of their careers and cannot afford to pay high premiums. Individuals who anticipate the requirement of a lump sum in the far future can also opt for this plan. Click here for the calculation of the premium on your life under this plan. 

Whole Life Insurance
Whole Life Insurance

What is a Whole Life Insurance Policy?

A Guardian whole life insurance policy covers you for your entire life, rather than a limited term as with term life insurance ⁠(which typically covers you for a period of 10, 20, or 30 years­⁠⁠)

A portion of the money you pay for your whole life insurance premium contributes to the cash value⁠—a financial asset that is guaranteed to grow and is tax-deferred

What are the Types?

There are 2 main types of permanent life insurance: traditional whole life insurance and universal life insurance. With a standard whole life insurance policy, you’ll pay a fixed premium for the entire length of your policy, meaning your required premium payments will never go up. But if you need more flexibility, a universal life insurance policy allows you to adjust your monthly premium payments while continuing to accumulate cash value. 

Is Whole Life Better Than Term Life?

That depends on your age, your financial obligations as well as your circumstances. For someone close to retirement, term life insurance may be the better value, but if you have many working years ahead of you, being able to accumulate a cash value with a whole life policy can help protect your family and your finances in more ways than one. 

Whole Life Insurance Benefits

Your whole life policy covers you indefinitely, so you’re protected for your entire life, as long as you continue to pay your required premium.

A portion of your premium is dedicated to creating a cash value you can access during your lifetime. The cash value portion is guaranteed to grow, so if the stock market goes up or down, the cash value is insulated from these fluctuations. You can withdraw or borrow funds from your cash value for any reason, including to buy a home, cover education or health care expenses, or supplement your retirement income. 

Your whole life insurance policy is based on fixed premiums, meaning the payments you make to maintain your policy will never go up. As long as you continue to make premium payments, you’re covered for life.  And, you may be able to choose a limited payment policy that allows you to stop making premiums after a set period.

The cash value growth in your policy is tax-deferred, so you don’t have to worry about paying taxes on it every year. Also, when you borrow against your cash value, the money you withdraw isn’t taxed as income. And, at death, the policy death benefit is income tax-free to your beneficiaries.

Do You Need Whole Life Insurance?

Working adults with dependents, whether children or aging parents are the most likely to consider life insurance, but whole life insurance has benefits to offer people of all ages and circumstances.

Nick Carlson purchased his Guardian whole life insurance policy when he was 26 years old. Years later, he was able to use that policy to purchase a home with his new wife and plan for the future education of their newborn child.

How Does Whole Life Insurance Work?

Whole life insurance has three components:

Life insurance: pays out when you die

Cash value

Premiums: what you pay monthly or annually

Premiums are used by the insurance company to pay expenses such as the cost of administering the policy, paying out death benefits, and the cost of evaluating people who apply for insurance (called underwriting).

A percentage of the premium goes into a tax-deferred portion, the cash value portion of your policy. The cash value earns interest and grows tax-deferred at a guaranteed rate. 

Frequently Asked Questions

Is whole life insurance a good investment?

The growth of the cash value in your whole life policy is guaranteed6 and doesn’t depend on financial market performance, giving you invaluable financial confidence.

Are whole life insurance premiums tax deductible?

No, your premium is not tax-deductible, but with whole life insurance, a portion of your premium is dedicated to building a tax-advantaged cash value. Money withdrawn or borrowed from the cash value up to the number of premiums you’ve paid is not considered income, so it’s not taxed as such.7 Your financial professional can also help you structure any withdrawals you make to avoid unnecessary tax penalties.

How to find the best whole life insurance policy

When choosing a whole life insurance policy, you’ll want to consider many factors, including the amount of coverage you need, the number of premiums you can afford, the financial strength of the company offering the policy, and any riders8 you can add for additional protection.

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