What Is Single Premium Life Insurance
Single premium life insurance is a policy purchased with one large lump sum payment at the beginning of the policy. This would be an ideal insurance policy if you have a large amount of cash, from a retirement account, savings account, inheritance, payments on another insurance policy, or even lottery winnings. According to the site at Wisata Jogja, single premium life insurance often has minimum requirements for premiums. This is usually $10,000. However, that $10,000 can get you a $50,000 policy that will pay out as soon as you pay the premium.
The Benefits
Depending on the age of the policy holder at the time of purchase, a person could have a significant amount of money available upon death secured from the one premium. The amount of protection will increase over time until it becomes many times greater than the initial investment amount paid to purchase the policy. This plan only works well if you plan on using the funds as a death benefit and not withdraw money from the insurance policy.
Single premium policies also pay annual dividends. You may also borrow against the insurance policy but usually at a high interest rate. Because it requires such a large sum of money up front, single premium policies also are easier to qualify for. The insurance company isn’t assuming as much risk because you have already covered a large portion of the death benefit in you initial payment. The death benefit can also be willed to charities or organizations.
Transfer Of Wealth
Another safe, tax-free option for purchasing single premium insurance is to transfer some of your wealth into the policy. The number of policies will not only continue to increase but will also be available if you need Wisata Magelang. The policy can also be converted to full cash value at any time during the life of the insurance policy.