Variable Whole Life Insurance (VWL)
Like whole life, Variable Life provides life-long protection with death benefits, fixed premiums, and builds up cash value. This policy remains in place for the whole life of the insured individual unless the policy lapses or is cancelled. Premiums are paid every year for the life of the policy to keep it in force. If you do not have a long-term need for life insurance and you are not willing to assume investment risk, this could be the wrong type of insurance for you.
Variable Whole Life Insurance includes:
- Guaranteed minimum death benefit (face amount) as long as you continue to pay premiums
- Premiums are level and invested in the general account of the insurance company
- Cash value earnings grow tax-deferred although not guaranteed
- Dividends, if any and not guaranteed, may be used to purchase additional insurance coverage or increase the cash value
- Ability to select a payment schedule that fits your needs (annual, semi-annual, quarterly, or monthly)
- Mortality rates, administrative expenses, and fees apply
- You are able to allocate your premiums in a variety of investment options with varying degrees of risks and rewards (stocks, bonds, or both; or a fixed account that guarantees interest and principal)
The cash value of a VUL policy is not guaranteed. The investment return and principal value of the variable subaccounts will fluctuate. Your cash value, and perhaps the death benefit, will be determined by the performance of the chosen subaccounts. Withdrawals may be subject to surrender charges and are taxable if your withdraw more than your basis in the policy. Policy loans or withdrawals will reduce the policy’s cash value and death benefit, and may require additional premiums payments to keep the policy in force.
All guarantees are based on the claims-paying ability of the issuing company.
