Understanding Permanent Life Insurance
You may have heard of permanent insurance or permanent life insurance but you don’t really know what it means. You may also be a bit confused on how this differs with the term life insurance. Let us dissect the real meaning of this term, identify what benefits you can get from it and differentiate it with other life insurance.
Permanent Insurance defined
Permanent Life Insurance also known as Permanent Insurance is a type of life insurance that does not expire. With the Permanent Insurance you can get the death benefit and you can also have a savings portion in which you can make loans from to finance personal and family needs.
The two types
At first permanent insurance was given as a type of Whole life insurance. It means that the plan remains with the holder in the entirety of their life and they would be guaranteed a payout. Usually the premiums of this type of plan are paid annually. Because the holders wanted to have more flexibility with their plans, the Universal life insurance was created. This type gave them more flexibility to the holders in terms of paying the premiums. They can pay it when they can and they can pay any amount they can. This type also gives the holder the option to withdraw cash from the plan permanently.
Variable life insurance
Now variable life insurance has been created. This is a combination of the two earlier types of insurance. Most holders considered this as the most favorable in all the plans. This provided them with greater returns and gave them bigger flexibility in managing their own money.
Unlike the term life insurance that can run out, the permanent life insurance gives greater advantages to the holder as it does not expire. Though it can be higher than the term life insurance, you can get more benefits and more flexibility with it. Aside from this, permanent life insurance also offers cash growth that is tax-deferred. Meaning you will not be paying any taxes on the earnings in the plan as long as it remains active.
Life insurance plans were originally created to benefit you and your family. That is why it is important to choose the best one for you. Go for the one that can give you the greatest benefits with the added flexibility. Now that you now about permanent life insurance, check if this will be best for you and your family.