answersLogoWhite

0

Does Life Insurance really pay

Updated: 8/19/2019
User Avatar

Wiki User

13y ago

Best Answer

Life insurance pays a stated amount of money upon the death of the insured. Payment is made if the policy was in force at the time of death and if the death was not the result of excluded causes.

Life insurance comes in two main varieties: term and whole life (sometimes called "permanent insurance"). Term is generally less costly because it provides "pure protection" during a fixed period of time (the "term", which may be 5,10,15, 20 years). The policy remains in force as long as premiums are paid and does not accumulate "cash value".

Whole life insurance also provides similar protection but does accumulate "cash value". The cash value aspect of whole life is somewhat like a savings account attached to the policy, and value accumulates slowly as premiums are paid. There are various kinds of whole life, including some that invest the cash value in mutual funds. Depending upon the performance of the savings element of the whole life policy, it can reach the point of supporting the policy such that no future premium payments have to be made.

Always bear in mind that life insurance should be considered protection, and never as an investment.

User Avatar

Wiki User

13y ago
This answer is:
User Avatar

Add your answer:

Earn +20 pts
Q: Does Life Insurance really pay
Write your answer...
Submit
Still have questions?
magnify glass
imp
Related questions

How is eligible to be on limited pay life insurance?

Limited payment life insurance, sometimes referred to simply as limited pay life insurance, is really a way of having the best of all worlds with a whole life policy. You pay a premium for a predetermined number of years and you have your policy for the rest of your life. Here is how the limited payment life insurance policies work.


Can you pay your life insurance premium online?

Contact your life insurance company and they can tell you if you can pay online


Do you have to pay taxes on a life insurance pay out IN THE UK?

no


Can you pay reassure America life insurance premiums online?

I would like to pay on line for my reassure life insurance


What if life insurance will not pay?

Why wouldn't it?


Do cops pay for life insurance?

no


Will a life insurance policy pay if you are killed in a wreck and liquor is involved?

No. Insurance co will not pay drink and drive accidents. Neither Life Insurance nor auto insurance cos.


When are dividends taxed on life insurance?

If you are receiving dividends from a life insurance policy, do you have to pay taxes and what %


Pick 'n Pay Sponsorship policy?

insurance, life insurance


Will I have to pay tax on your ex husbands Life insurance after his death If I am the owner of the policy?

Do I have to pay tax on my exhusband's life insurance if I am also the benificary of the policy?


Does the beneficiary of a life insurance policy have to pay taxes on the proceeds?

The answer to the question of whether or not beneficiaries have to pay taxes on the money received from life insurance policies is: no they will not have to.


How do I get on a limited pay life insurance plan?

Limited pay life insurance is really just a form of whole life. The difference is that the policy holder pays premiums only for a preset period of time, after which they enjoy the benefits of the policy for life. Policy holders can also borrow against this type of policy if needed, and it pays dividends.