Four benefits of life insurance you might not know about

By Soko Directory Team / Published October 2, 2022 | 12:07 pm





Permanent life insurance policies can offer tax breaks 

Permanent life insurance policies can offer tax breaks in the UK, as long as they are held within a specialized trust. These trusts are designed to shelter the policy from inheritance tax and can also offer other benefits, such as income tax relief.

For example, a trustee can elect to have the policy payout paid directly to the beneficiaries, free of any inheritance tax. Your loved ones could potentially receive a larger lump sum of money than if the policy was subject to inheritance tax.

There are several points to consider before taking out a permanent life insurance policy, and seeking professional financial advice is recommended. However, if you want to provide financial security for your family after you die, then a permanent life insurance policy could be the right choice for you.

Any reputable life insurance broker will tell you that safeguarding your family against the financial burden of a loved one’s death is only one of the benefits of life insurance. This article will provide you with four pieces of advice you might not have known.

Permanent life insurance can allow you to borrow against the policy’s value

Permanent life insurance can be a valuable financial tool for its death benefit and the cash value it builds over time. You can access this cash value through policy loans, which act as a source of collateral-free funding.

Policy loans come with interest, which is charged back to the policy’s cash value. However, this interest rate is usually lower than what you would find with other types of loans, making policy loans an attractive option for those in need of extra funds.

Best of all, policy loans do not have to be repaid until the policyholder dies or surrenders their policy. This means you can use the loan proceeds for any purpose you see fit without worrying about making monthly payments.

If you’re looking for a way to access the cash value of your life insurance policy, consider taking out a policy loan. It could be just the financial tool you need.

You can use life insurance as an investment tool since the money paid into a policy can grow over time

In addition to providing peace of mind in the event of your death, life insurance can also be used as an investment tool. The money that you pay into a life insurance policy can grow over time, providing you with a nest egg that can be used for various purposes, such as retirement income or college tuition expenses.

You can choose from different types of life insurance policies that offer different levels of coverage and have different features. Some policies even offer cash value accumulation, which allows the policyholder to borrow against the policy’s death benefit. Take the appropriate time to consider all of your options before purchasing a life insurance policy.

When used as an investment tool, life insurance can be a great way to provide yourself and your family with financial security. Remember that life insurance is not an investment in the traditional sense. The money you pay into a policy is not invested in stocks or mutual funds, so it will not grow at the same rate as other investments. However, over time, the cash value of a life insurance policy can grow significantly, providing you with a valuable resource to tap into when needed.

Term life insurance is more affordable and can be a great way to protect your loved ones financially if something happens to you

Term life insurance is often less expensive than whole life insurance because it does not require you to pay premiums for the entire length of your life. Whole life insurance policies do not have a set term, which means that you will be required to pay premiums until you die. This can be expensive, especially if you live to be very old. Term life insurance gives you the peace of mind of knowing that your family will be financially okay if something happens to you without requiring you to keep paying premiums forever. 

Term life insurance is a more affordable way to protect your loved ones financially if something happens to you. It can be a great safety net for your family in case of premature death. Always shop around first and compare different policies before choosing one, and make sure that it is affordable for your budget.

Finally: Review your life insurance policy regularly and update it as your needs change

Your insurance needs to change as your life progresses. Regularly check your life insurance policy to ensure it stays up-to-date and that you’re adequately covered. This will guarantee that you and your family are always safe.

It’s crucial to choose an appropriate life insurance policy amount when you first take out a policy. This will ensure your loved ones are sufficiently cared for financially in the event of your death. However, as time goes on, your family dynamic may change – say, you have more kids or pay off your mortgage. As life happens and changes occur, it’s important to readjust your life insurance coverage so that it still meets the needs of those who depend on you.

It is generally a good idea to review your life insurance policy at least once every few years. This will ensure that it still meets your needs and that you are not paying for more coverage than you need. If you have questions about whether your policy still meets your needs, contact your life insurance agent or company. They will be able to help you determine if you need to make any changes to your policy.




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

View other posts by Soko Directory Team


More Articles From This Author








Trending Stories










Other Related Articles










SOKO DIRECTORY & FINANCIAL GUIDE



ARCHIVES

2022
  • January 2022 (293)
  • February 2022 (329)
  • March 2022 (360)
  • April 2022 (294)
  • May 2022 (271)
  • June 2022 (232)
  • July 2022 (278)
  • August 2022 (253)
  • September 2022 (246)
  • October 2022 (196)
  • November 2022 (230)
  • December 2022 (10)
  • 2021
  • January 2021 (182)
  • February 2021 (227)
  • March 2021 (325)
  • April 2021 (259)
  • May 2021 (285)
  • June 2021 (273)
  • July 2021 (277)
  • August 2021 (232)
  • September 2021 (271)
  • October 2021 (305)
  • November 2021 (364)
  • December 2021 (249)
  • 2020
  • January 2020 (272)
  • February 2020 (310)
  • March 2020 (390)
  • April 2020 (321)
  • May 2020 (335)
  • June 2020 (327)
  • July 2020 (333)
  • August 2020 (276)
  • September 2020 (214)
  • October 2020 (233)
  • November 2020 (242)
  • December 2020 (187)
  • 2019
  • January 2019 (251)
  • February 2019 (215)
  • March 2019 (283)
  • April 2019 (254)
  • May 2019 (269)
  • June 2019 (249)
  • July 2019 (335)
  • August 2019 (293)
  • September 2019 (306)
  • October 2019 (313)
  • November 2019 (362)
  • December 2019 (318)
  • 2018
  • January 2018 (291)
  • February 2018 (213)
  • March 2018 (275)
  • April 2018 (223)
  • May 2018 (235)
  • June 2018 (176)
  • July 2018 (256)
  • August 2018 (247)
  • September 2018 (255)
  • October 2018 (282)
  • November 2018 (282)
  • December 2018 (184)
  • 2017
  • January 2017 (183)
  • February 2017 (194)
  • March 2017 (207)
  • April 2017 (104)
  • May 2017 (169)
  • June 2017 (205)
  • July 2017 (189)
  • August 2017 (195)
  • September 2017 (186)
  • October 2017 (235)
  • November 2017 (253)
  • December 2017 (266)
  • 2016
  • January 2016 (164)
  • February 2016 (165)
  • March 2016 (189)
  • April 2016 (143)
  • May 2016 (245)
  • June 2016 (182)
  • July 2016 (271)
  • August 2016 (247)
  • September 2016 (233)
  • October 2016 (191)
  • November 2016 (243)
  • December 2016 (153)
  • 2015
  • January 2015 (1)
  • February 2015 (4)
  • March 2015 (164)
  • April 2015 (107)
  • May 2015 (116)
  • June 2015 (119)
  • July 2015 (145)
  • August 2015 (157)
  • September 2015 (186)
  • October 2015 (169)
  • November 2015 (173)
  • December 2015 (205)
  • 2014
  • March 2014 (2)
  • 2013
  • March 2013 (10)
  • June 2013 (1)
  • 2012
  • March 2012 (7)
  • April 2012 (15)
  • May 2012 (1)
  • July 2012 (1)
  • August 2012 (4)
  • October 2012 (2)
  • November 2012 (2)
  • December 2012 (1)
  • 2011
    2010
    2009
    2008
    2007
    2006
    2005
    2004
    2003
    2002
    2001
    2000
    1999
    1998
    1997
    1996
    1995
    1994
    1993
    1992
    1991
    1990
    1989
    1988
    1987
    1986
    1985
    1984
    1983
    1982
    1981
    1980
    1979
    1978
    1977
    1976
    1975
    1974
    1973
    1972
    1971
    1970
    1969
    1968
    1967
    1966
    1965
    1964
    1963
    1962
    1961
    1960
    1959
    1958
    1957
    1956
    1955
    1954
    1953
    1952
    1951
    1950