fincash logo SOLUTIONS

Fincash » Permanent Life Insurance

What is a Permanent Life Insurance?

Updated on July 16, 2024 , 555 views

When talking about Life Insurance, a lot of people have a notion that it is all about a payout that a beneficiary gets after the insured passes away. For term life insurance, this perception is accurate. However, permanent life insurance takes all of it a step further.

Permanent Life Insurance

Not only does it offer a death benefit, but it also has a savings benefit or cash value, which a policyholder can use in several ways.


Permanent life insurance is intended to achieve two objectives:

  • It offers an Inheritance or a safety net for the family as the death benefit that pays an amount after the death
  • It lets you accumulate savings that can be borrowed in the form of a cash loan

Permanent Life Insurance Vs Term Life Insurance

Permanent life insurance is meant to last a policyholder’s lifetime. Generally, the premium is higher than term life insurance as it also funds a cash value account along with a tax-free death benefit. Additionally, the cash value grows over a period of time and can be used for an array of objectives, such as low-interest loans. You can use this cash value account to create an Income flow for supplementary retirement income. However, this might impact the death benefit.

Term life insurance, on the other hand, offers a death benefit, which is typically paid to the beneficiary without deducting any Taxes. The insurance pays the death benefit in case the insured passes away during the tenure is active. This policy can be kept in force by paying a premium in total every year.

Get More Updates!
Talk to our investment specialist
By submitting this form I authorize to call/SMS/email me about its products and I accept the terms of Privacy Policy and Terms & Conditions.

Reasons to Buy Permanent Life Insurance

Some of the significant reasons to buy permanent life insurance are as follows:

  • Generally, the premium amount stays level throughout the lifetime of the insured
  • It guarantees savings aspect; thus, it allows undisciplined people to have a backup amount to rely upon
  • The beneficiary gets a guaranteed death benefit when the policyholder is no longer alive. In a lot of situations, it is tax-free
  • It helps build a cash value that can be withdrawn during a lifetime
  • The policy offers financial stability and support
  • If you want to leave your inheritance to heirs, you can use this policy to pass down money to them
  • Some insurance options pay dividends, which can be received as cash, saved to accrue interest, applied to premiums or used to get more insurance

Does Permanent Life Insurance Expire?

This policy type is designed to last the whole life, right from the time you purchase it until you either stop making payments or die. Most of these policies mature when the policy buyer reaches 121 years of age. At this point, the policy ends, and the company pays the death benefit.

How to Select the Right Insurance?

When choosing permanent life insurance, keep these factors in mind to make the proper selection:


Some policies, such as final expense insurance, are created for older adults. Health considerations might also play a role in specific policies as well.


Find out how much you can spend every month on premiums, and then choose the policy accordingly.

Coverage Amount

Some policies are available in more significant amounts to assist cover up huge expenses, such as retirement, loans, and more. Others provide smaller amounts at an affordable rate to help cover the funeral expenditure or other end-of-life costs.

Cash Value

Comprehend if the capability to borrow from the policy during your lifetime is a notable feature for you or not. For instance, do you wish to access the cash value during the retirement years? If yes, find out the rules of the policy and how soon you can get the cash value after purchasing the policy.

Wrapping Up

The effortless way to begin is to look out for permanent life insurance quotes. And then compare those plans’ prices along with their features. After zeroing down all the requirements, choose a policy that caters to your requirements in the best possible manner.

All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
How helpful was this page ?