What Is Whole Life Insurance?


 What Is Whole Life Insurance?

Whole life insurance pays out a sum of money (often called the death benefit) to the people, businesses, trusts, or charities designated as your beneficiaries when you die. Whole life policies are permanent, which means your beneficiaries will get your death benefit no matter when you die. In contrast, a term policy only covers you for a period, such as 10 or 20 years. Whole life insurance also comes with a cash value component. As you pay your premiums, your life insurance provider sets a portion of that money aside into an account where it can grow at a steady (albeit usually very slow) rate. 

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