Beginner’s Guide to Whole Life Insurance
man meeting with an insurance agent to get whole life insurance

If you’re looking for a life insurance policy that provides a lifetime of financial security for you and your family, whole life insurance might be the plan for you. While there are many benefits to getting a permanent life insurance policy like whole life insurance, the greatest advantage is that you can insure your life while also building cash value on a tax deferred basis. In this article, we explain how whole life insurance works and how it can benefit your long-term financial plans.

What is whole life insurance?

Whole life insurance guarantees financial protection and safeguards your future financial needs. This type of permanent life insurance is just like it sounds – insurance that lasts your whole life. You select an amount of coverage when you sign up for a policy and when you pass away, your beneficiary receives funds to use at their discretion. Many beneficiaries use death benefits to fund their children’s education, supplement retirement income and cover their loved one’s funeral expenses.

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Learn More About Final Expense Insurance

To learn more about whole life insurance policies that cover funeral expenses, check out our guide to final expense insurance.

Whole life policies are popular because they offer protection for life. They are also popular for their cash value component, which can be used to make partial withdrawals, take out a loan or in some cases, pay premiums.

How does whole life insurance work?
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Apply for Coverage

Whole life insurance starts with an application for coverage with an insurance company. With Quility, you have the choice between a digital consultation or an at-home consultation with a licensed insurance agent.

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Make Payments

Once your policy is in force with an insurance company, you pay premiums to maintain coverage. As your insurance needs change, your premiums can be adjusted – simply reach out to your agent.

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Use the Cash Value Component

As your policy matures, you can withdraw from the accumulated policy cash value. If you don’t need life insurance anymore, you can surrender your policy and receive an equivalent sum of funds to the surrender cash value.

The first step to getting whole life insurance is to apply for coverage with an insurance company. Then, you’ll pay premiums to maintain coverage. 

Whole life policies have flexible terms, meaning you can avoid a lapse in your policy if you don’t pay your premium on time as well as adjust your policy as your needs change. As your policy matures, you can begin to use its cash value component to supplement income and build tax-deferred savings right inside your policy. 

Who needs whole life insurance?

Whole life insurance is right for you if you’re looking for a life insurance policy that guarantees a death benefit as well as an insurance solution that comes with additional perks, such as an accumulated cash value that you can borrow against and the flexibility to update your policy as life changes.  

Like other types of life insurance, premiums for whole life policies depend on your age and health at the time of your application. If you’re interested in whole life insurance, you’ll get the best rate by applying today. 

What is the difference between whole life and universal life insurance?

Universal life insurance is another type of permanent life insurance. While similar, universal life insurance is generally more affordable than whole life insurance as it is designed to last the average lifespan – rather than your whole life. Universal life policies may be more affordable, but you can expect to pay premiums for longer. Both options come with adjustable premiums, flexible policy terms and a cash value component.

How much does whole life insurance cost?

Everyone has different life insurance budgets and goals, but permanent life insurance policies (whole life) are generally more expensive than temporary life insurance policies (term life). However, with the increased premium comes peace of mind for a lifetime compared to certain stages of life. 

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Read More on Term and Permanent Life Insurance Policies

To learn more about the differences between temporary and permanent life insurance, check out our guide to the differences between term life and permanent life insurance.

Get a whole life insurance policy in place today

Getting whole life insurance means choosing a solution that will stand the test of time. Whole life insurance offers permanent coverage, flexible premium payment options and a cash value savings component – as well as peace of mind for your family and finances.

Quility’s trusted insurance advisors can get you the best life insurance policy at the best price. We partner with more than 80 of the top life insurance companies and take the time to fully understand your budget and needs. Connect with a licensed agent today.

Let’s Get Started

Get a permanent life insurance policy that fits your needs with support from our trusted advisors.

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Calie Brummer
Head of Digital Communications
Calie Brummer is a staff writer and Head of Digital Communications at Quility Insurance with a focus on financial well-being and life insurance solutions.