Benefits of Single Premium Life Insurance
Single premium life insurance has quite a few perks, which include:
Single Payment
The biggest benefit of single premium life insurance is exactly that – a single premium, or one payment. You don’t have to worry about or manage future payments, and you know you’ll be guaranteed a death benefit. In addition to that, single premium life policies are great in conjunction with Long-Term Care Insurance, or a long term care rider.
Long-Term Care Insurance
Long-term care (LTC) insurance is a type of insurance that provides financial assistance to those who need help completing their activities of daily living (ADLs). These activities include dressing, bathing, eating, continence, transferring, and toileting.
This type of insurance can be very expensive, which is where SPL comes in. Certain SPL policies will give you tax-free access to your death benefit, so you can pay for the those long-term care expenses.
Whatever money is leftover from the death benefit after you pass away will be given to your beneficiaries income tax-free. If you don’t need any of the death benefit for LTC, then all of it will go to your beneficiaries as originally planned. But if you do need access to it, SPL can be very beneficial.
Terminal Illness
In addition to using the death benefit for LTC, many SPL plans offer an accelerated death benefit rider, which allows part of the death benefit to be accessed if you become diagnosed with a terminal illness and have a life expectancy of 12 months or less. Oftentimes, getting diagnosed with a terminal illness can be very costly, and using the death benefit to help with expenses can take a great load of pressure off you and your family.
Cash Value
If you choose to go with a single premium whole life policy, you’ll have access to cash value if need be. While this should not be your first go-to, cash value is a nice advantage if an emergency financial situation were to occur.
