Far more times than not, when we work with new clients that have a cash value life insurance policy, we are looking for better ways to use those premium dollars. If you are currently stuck in a cash value life insurance policy, here are three options for you to consider.
Take cash and get term insurance
The first thing you can do is simply drop the policy and take the cash value. With most of our clients, especially younger families, it makes much more sense to use the cash to pay off debt and pick up term life insurance. However, be cognizant of the tax implications of this move and NEVER drop an existing life insurance policy without replacing it first.
Transfer it to a different policy
Another option is to transfer the existing cash value policy into a similar policy with guaranteed premiums and benefits. One of the biggest qualms we have with many cash value policies is the premiums go up while the death benefit decreases with time.
Add a long term care rider
For people nearing 60 years old, now would be a good time to transfer that cash value policy into a similar policy with a long term care (LTC) rider. Long term care insurance is really expensive, but this is one way to pay to bit a more to get long term care coverage. If you need help deciding which option is best for you, please call 320.222.4236 or email me directly at email@example.com.