For most people who know even a little about life insurance, most will agree that it seems like whole life insurance has been around forever. Whole life is the most common type of life insurance and includes the benefits and guarantees that large portions of the insurance marketplace looks for and depend on.
Most of our clients use whole life insurance for funding their Infinite Banking Plan. This is where one will use a whole life insurance policy for financing their lifestyle. Funded properly, you can build enough cash value in your whole life policy to purchase vehicles, college tuition, homes and retirement.
Because whole life insurance is guaranteed to last for a lifetime while at the same time building cash value for the policyholder, it is the most expensive life insurance product in terms of monthly premiums. Although the product appears to be straightforward in its design, it can easily be the most confusing life insurance out there.
The guarantees and benefits that make up whole life insurance are typically what motivate many consumers to purchase this coverage even though it is the most expensive kind of life insurance. The three major benefits that every whole life insurance policy contains are:
- Life Insurance Coverage for a Lifetime – With a whole life insurance policy in place, the policyholder will have coverage if they die at age 75 or at 99 and the policy cannot be canceled by the insurer for any reason other than non-payment.
- Guaranteed Level Premiums – Once your whole life insurance policy is issued, your periodic premiums are etched in stone. The insurance company cannot increase your premium for any reason; period.
- Cash Value – All whole life insurance policies will build cash value over time because the policyholder pays in more than the actual cost of life insurance and the insurance company will pay interest on the cash account that is guaranteed in the contract. Also, if your whole life insurance policy is a participating policy, the insurance company will pay dividends (portions of the company profits) to the policyholder every year. Although dividends are not guaranteed, rarely does a company ever elect not to pay them.
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How are Whole Life Insurance Rates Calculated?
Just like term life insurance and universal life insurance, the rates for whole life insurance are based on three things:
- The Age of the Applicant – The younger you are when you purchase a whole life insurance policy, the lower your premiums will be because the insurance company can collect premiums on your policy longer than they could for someone who is older than you are. Also, since women generally live longer than men, the insurance rates for women are lower than rates for men because the company knows they can collect more premium over the lifetime of a woman.
- The Health of the Applicant – Your health and health history is also a solid indicator of how long you are expected to live. When an applicant is very healthy and there are no indications of an unfavorable family health history, the insurance company will offer preferred rates because of your health. On the other hand, if you have one or more health conditions that could impact how long you will live, the insurance company is likely to offer rates higher than that of a very healthy person. In this case, a simplified issue whole life insurance policy may be the answer.
- The Amount of the Death Benefit – As with any insurance product, the more life insurance you need, the more you will pay for your insurance policy.
What else can Impact My Whole Life Insurance Rates?
As we mentioned earlier, anything that can affect how long you will live will have an effect on your whole life insurance rates and that includes things other than health issues.
- Your Occupation – Certainly, there are occupations that are considered “dangerous” or “hazardous” and as such, insurance companies will normally consider your occupation when they establish your whole life insurance rates. For example, first responders like the police, firemen, and emergency medical technicians who must run toward dangerous situations will likely be charged more for life insurance than someone who has a non-hazardous occupation.
- Your Hobbies – If you are involved with extreme sports like mountain climbing, deep-sea diving, car or motorcycle racing, or other extreme sports, you’ll likely be charged more for your life insurance than a person who does not participate in these kinds of activities.
- Your Travel – Applicants who travel to countries that are considered dangerous because of terrorist activities or countries who have shown to be hostile to U.S. citizens will also pay more for coverage or even declined in some cases.
How Can I Find the Best Whole Life Insurance Rates?
An independent insurance professional should always be your first step in finding the best whole life insurance rates. Agents that are “independent” typically represent all of the top-rated life insurance companies instead of only one or two like a “captured” or “company” agent.
Company agents are also limited to offering a “cookie-cutter” policy where only selected applicants can qualify for preferred rates. Independent agents, on the other hand, represent many companies and most of them have what we call “sweet spots.” Sweet spots are certain underwriting scenarios where one insurance company might offer a preferred rate and many others will not. Or one company might offer a policy with a table rating where other insurance companies might decline the application altogether. Some companies offer participating policies and some do not.
Since an independent agent has access to multiple insurance companies that have multiple insurance products, consumers are far more likely to find the solution that best meets their needs and their budget.
What are the Best Whole Life Insurance Rates for a $100,000 Policy?Here are actual Whole Life Insurance rates for a $100,000 policy for a healthy male and female non-smoker:
As you can see from this Whole Life Insurance rate chart, the rates for women are less than the rates for men. This is because women typically live longer than men. You will also notice that as your age increases, so does your whole life insurance rates. This means that you can never buy life insurance cheaper than you can today. Don’t waste money by putting off a decision while you do your research. Call an independent agent today so you can get the best whole life insurance rates available now.
Frequently Asked Questions
Why should I buy whole life insurance?
The guarantees and benefits that make up whole life insurance are typically what motivate many consumers to purchase this coverage even though it is the most expensive kind of life insurance. The three major benefits that every whole life insurance policy contains are: life time coverage, guaranteed premium, and cash value.
How can I find the best whole life insurance rates?
An independent insurance professional should always be your first step in finding the best whole life insurance rates. Agents that are “independent” typically represent all of the top-rated life insurance companies instead of only one or two like a “captured” or “company” agent. Ogletree Financial Services 800-712-8519 can help you find the right fit!
How much does whole life insurance cost?
A sample monthly premium for a $100,000 whole life policy on a healthy 40-year old non-smoker would be $134.31 for a male and $114.98 for a female. Your premium would be based on your personal underwriting. An independent life insurance agent can help with your search for affordable whole life insurance.