Life Insurance Information You May Not Know
June 30th, 2014
First of all, you can have more than one policy if you like. Some people, for example, opt to add a term life policy to their standard permanent life insurance. You can even get more than one policy from the same carrier. However, expect some questions if the insurance coverage you’re requesting seems unnecessary.
If you have a permanent life insurance policy, it may be possible to borrow from it to actually pay your premiums on it. However, you have to have enough cash in it for this to be possible. You’ll need to speak to your carrier about this though and it’s really a worst case scenario option.
There are also times when you can benefit from life insurance before your death. An accelerated death benefit is one example of this. If you are diagnosed with a terminal illness, you can request the face value of the policy instead of having it paid out to a beneficiary upon your death. Another option your policy may cover is called portability. This just means that you can take your policy with you from one job to the next or at retirement, during which they could benefit from group rates. The last way you can get more from your life insurance while still alive is through a waiver of premium. It means that the protection is kept in place even if you suddenly become mentally ill or accrue a disability.
An extreme example of getting more from your life insurance policy actually involves profiting from it while still alive. Life settlements are the term used for when someone actually sells their life insurance policy. Obviously, they take less for it than what it would eventually become worth, but it’s money they’d otherwise never see. The purchaser, then, stands to make a profit when the insured passes away. As you can imagine, this is a very controversial practice that no one should take on without an expert’s opinion first.
Don’t let life insurance become a policy you simply pay and know nothing about. If the above has provoked more questions from you, speak to your carrier to get the answers or clarification you’re entitled to.