Note: permanent life insurance here means universal life or whole life. Also: it is assumed that premiums are paid as scheduled. Life insurance can be a little bit technical. Call me and I’ll explain the details about these advantages so you’ll know what we’re talking about.
Here are the top five reasons to buy permanent life insurance, in my humble opinion:
1. No rate increase
You get a lifetime guarantee on the premium. It will never go up, so you won’t be blindsided by a huge rate increase. Also: what if you had a term policy that became too expensive, but you unfortunately were no longer insurable, due to illness? You wouldn’t be able to secure your family or business just at the time when they might need it.
2. No reduction of coverage
You also get a lifetime guarantee on the death benefit. Regardless of the investment performance of the company, they cannot lower your face amount. More than that, the right product will actually increase the death benefit for you!
3. Payment flexibility
You have flexible payment options. You can pay for one year, 10 years, 20 years, or according to another schedule, and still get a lifetime guarantee on the death benefit. Then again, you can pay on a yearly basis and keep your expenditure as low as can be.
4. Guaranteed cash
You can get a guaranteed cash value. If you are the kind of person who wants a guaranteed portion of your financial portfolio, few other products will match the guarantees of life insurance. At the same time, these products can also have non-guaranteed cash values that can grow significantly over time.
5. Low long-term cost
The rate you pay at age 30, let’s say, will be the rate you pay at age 90. You can enjoy a long-term savings by locking into a premium for one permanent policy, as opposed to buying a term policy every time you need one as you grow older. The premium on a policy bought at age 30 for life, is frequently lower than the premium you would pay on a policy at age 30, and then another at age 50, and then another at 70, all added together.
Stretch your brain a little bit and think long-term about life insurance. How does it feel?