Whole life is permanent insurance which provides lifetime protection for a level premium. Obtaining an understating of the need for longer term or permanent component is an important first step. Whole life insurance spreads the cost of insurance either over the lifetime of the policy or for a limited period of time. As a result, this type of insurance generally has higher premiums than term insurance in the initial years but does not have the periodic increases associated with term insurance. Whole life polices often have a cash value if the policy were to be surrendered. Certain policies may pay periodic dividends or allowing certain levels of participation. Whole life can be a powerful tool for those with long-range financial goals.
