Combine Whole Life And Term Life Policies
Have you ever thought of combining a whole life insurance policy with a term life policy? The benefits, although not glaring, are there to be seen. It actually works out pretty well. Think about it. If you use your whole life policy as a base and add term life to it, you would get more death benefit.
Of course, you could say that you would have got more death benefit by taking only the term life policy. But then you have to keep in mind, that if you didn’t die in the period for which you have the policy, you wouldn’t get anything back. This is unless you’ve bought a ‘return of premium term policy’.
Getting the combination right requires some planning though and you must not go about it blindly. You’d only need to buy around 30% whole life and around 70% term life if you happen to qualify for a preferred risk policy with a top-level company. This combination won’t only offer you a good amount of total life insurance, but also cash values that you can fall back on in times of need. Whether you buy a 5, 10, 15 or 30 year term life policy would depend on what your individual needs are.
It makes sense to go in for a combination also because the premium that you pay for your whole life policy accumulates over time and you can benefit from that. This will be very handy later on when; you are unfortunately not able to pay the required monthly premium. Of course, it does take a considerable amount of time for this money to accumulate into anything substantial.
You will find that this idea is being used by actuaries to formulate actual policies. On close examination, it is clear that these plans are a combination of a term policy and a savings plan. The variable universal life insurance policy is term insurance combined with an investment.
The best way of going about combining policies is to figure out exactly what you need and then speak to an expert who will advice you as to whether you should combine or not. And if yes, then how best to go about it.
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