With a name that is both somehow literal and confusing, Whole of Life insurance can be difficult to get your head around. Read on to learn how it works.
Whole of life insurance is insurance that covers the policyholder for their entire life, rather than for a set period of time. The policy pays out a lump sum upon the policyholder's death, regardless of when that occurs.
Whole of life insurance policies are often purchased in order to provide financial security for loved ones in the event of the policyholder's death. The death benefit can be used to help cover funeral costs, outstanding debts, or other expenses. Whole of life insurance can also be used as an inheritance planning tool, as the death benefit is typically paid out tax-free.
Whole of life insurance policies offer a number of benefits, including financial security for loved ones, peace of mind for the policyholder, and the ability to use the policy as an inheritance planning tool. Whole of life insurance policies also tend to be more expensive than other types of life insurance, such as term life insurance.
Read our short guide to term life insurance to find out.
Life insurance can be a tax deductible business expense in certain cases. For example, if the life insurance policy is taken out on a key employee, the premiums can be deducted as a business expense. Additionally, if the life insurance policy is used as collateral for a business loan, the
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