Variable life coverage is a type of life insurance that provides permanent protection for the insured, and provides a death benefit to the beneficiary when the insured perishes. Variable life insurance is different from permanent life insurance because a certain amount of your premiums go towards a separate account that invest your money in a variety of ways to benefit your savings.
How It Works
With variable life insurance, the insured can invest some of their premiums without being taxed on the earning. While this can be highly profitable if the market is doing well, it can also be a risky policy to choose if the market is in poor shape. In this case, the insured will still get coverage, but premiums may rise due to their inability to make money from the invested amounts.
A Variable Life Policy May Be A Good Choice If You”
-Know how to invest money and understand how the market works.
-Are intrigued by the possibility of increasing your policy’s cash value.
-Are aware of and understand all of the risks.
-Can afford to pay the possibly fluctuating premiums.
-Appreciate the flexibility you have with your policy and want to be able to change your coverage over time.
Variable Life Coverage Conclusion
While variable life coverage comes with some risks, it can also come with some big payoffs. This form of permanent life insurance comes with the potential of a greater cash value for your policy if you know how to invest properly.
Speak with your First Life insurance agent to find out if variable life coverage is right for you.