Hole life insurance question

You cannot borrow versus the death benefit in your policy. You can, however, borrow against the cash value in your policy.

There are two stacks of money inside a Whole Life contract. The first is the death benefit, which you can only access through death (not actually you, but your beneficiary). The second stack of money is the cash value. It is what the policy is worth if you surrendered it. For example, I may have a 15-year old policy with a million dollars in DB, and $250,000 in cash value.

If I surrender the policy, I get the cash value. Or, I could take a distribution, which is an outright withdrawl from the policy, or, I can take a loan out on the cash value of the policy.

However, since your policy is only a couple months old, I'm guessing you have 0 cash value in the policy. You would do well to secure funding from another source.

In another vein, there are a couple of ways to access the death benefit of a life insurance policy, but none are very pleasant.

1.) You have a Long Term Care need. This means a doctor has found you incapable of performing 2 of the 6 activities of daily living. These include feeding, bathing, dressing, and managing one's faculties. During this situation, the insured may make "early withdrawls" on their WL policy to help pay for cost associated with nursing homes and in home care programs.

2.) You have a terminal illness, and you sell your WL contract to a viatical company. Usually, these companies pay the individual a reduced some of money upfront (usually 20-30 percent), and in return, the individual makes the viatical company the beneficiary and owner, etc. of the life insurance policy.

Hope that helps.

Is it smart to buy a life insurance without a 401k or 403B? I wonder if I should just put all my money in the life insurance plan and go without a 403B. The finance manager said the $ from the life insur. would be tax free.

what is the differance between hole life and term life

What is the differance between Hole life and term