Life insurance policies generally are not something you can return and  get your money back. But, there are policies that include cash value  that grows over time. With some of these policies you can access the  cash value while you are still living. Life insurance is a financial protection for your family and loved ones following your death. 

Let’s talk about permanent life insurance

Permanent life insurance policies are life-long and have cash value that  increases over time. These permanent policies contain a face amount  or as it is called, a death benefit which is the amount paid at the time of  death. The cash grows with time on a tax-deferred basis, and that is  similar to retirement savings plans.  

How does cash value work? The type of permanent life insurance policy  you choose will determine the way your cash value accumulates over  time. There are certain policies that allow extra money to be put into  the policies to increase the cash value, but there are limits to how high  the cash value can get in relation to the death benefit. If an insurance  policy is over-funded, it is considered an investment and it loses the tax  advantage. Life insurance when paid out at the time of the insured’s  death is tax free. In addition, many permanent policies allow you to pull  money from the cash value. Some examples may be a down payment  for a home, paying for your children’s college education, or additional  income for your retirement. 

Cash value policies after the insured’s death

What happens to the cash value after the insured’s death? When the  insured passes away and a death claim is filed, it terminates the  contract and stops the cash value from continuing to grow. Depending  on the type of insurance policy and death benefit, the cash value may  or may not be paid in addition to the death benefit.

You can use life insurance to build wealth. Many people do not know  that the death benefit is just one portion of life insurance. It can also  serve as a type of savings account letting wealth build throughout the  

years while you are alive. When you take into consideration a  permanent policy, the whole picture changes. Seriously consider  permanent life insurance if you are in your twenties, thirties, forties, or  even a senior citizen. The average permanent policy allows you to grow  your cash value by 6-8% annually. In typical savings accounts you will  earn a standard 0.1%. It is also a safer bet than other investment types,  for example stocks and bonds.  

Can I add riders to life insurance policies?

That answer is yes. Riders can  be customized to suit your needs. Some cost extra, others are free. A  popular rider is long-term care. This provides assistance later in life for  you if you do not have someone to look after you. Permanent policies  are more expensive than other life insurance policies. This may be a  negative for you, but if you look further you will see the benefits of having this type of life insurance. 

If you are looking to find out more about life insurance and the benefits  it provides, IMOR Financial is here for you. We provide complimentary consultations to help you understand and answer your questions. Please email Vickie at This email address is being protected from spambots. You need JavaScript enabled to view it. or call at 717-790-2171.