If you live in Austin, TX, you may have purchased a whole life insurance policy through Southwest Insurance Center so you could have access to cash if you needed it. There wouldn’t be much point in having it if you were afraid to ever use it, but it can be difficult to decide when to take advantage of it. You may even need to pay taxes on the cash you get, so you want to make sure you are doing the right thing.
Two Kinds of Benefits In a Whole Life Policy
There are actually two kinds of cash benefits available if you have a whole life policy. The first one is the same as you would have with a term life policy, a death benefit. That benefit comes into play if you die, and your beneficiary will have access to that money to help settle your estate or help pay for your funeral or other expenses.
The unique advantage to a whole life policy is the actual cash value. When you pay your premium, the money adds up and could get quite large over time.
Borrowing, Withdrawing or Surrendering
There are three ways you can get the cash value from your policy. You can simply borrow the money and pay it back, so you still have a solid policy later. You can withdraw money and keep it, which diminishes your total. Or you can simply surrender your policy, cashing it out and canceling your policy.
When you are thinking about getting cash from your policy, it may help to know you can keep your policy, and even pay the money back. If you are in Austin, TX and have any questions about your policy, or if you would like to purchase one, give Southwest Insurance Center a call today.