I'm confused about whole life insurance.?

There is a quote from investopedia:

"The death benefit is the amount payable to beneficiaries of the insured individual once the insured passes away, and the cash value balance is a forced savings component available to the insured while he is still living."

So at the time of "the insured" death the beneficiary receives "death benefit", if "the owner" decides to take money earlier he receives "cash value". But it looks like my "cash value" is actually larger than my "death benefit". Aside from the tax consequences, what would be the reason not to take cash value now?

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  • B
    Lv 7
    4 weeks ago

    re-read your papers, it is highly unlikely your cash value is more than death benefit; call the insurance carrier in any case to clarify

  • 1 month ago

    It's very unlikely that the cash value is more than the death benefit.  When you "borrow against" the cash value, it reduces the death benefit by the amount you borrow, plus fees.   If you "take" the cash value, that means you're cancelling the policy.  

  • 1 month ago

    Nope.  Impossible.  The cash value can't exceed the death benefit.  It could exceed your ORIGINAL death benefit, but can't exceed the current death benefit.  The cash value could/would push the death benefit up.  You're not looking at something right.

    My cash value has pushed up my original death benefit about 70%.  In a whole life policy this could be in the form of dividends.  

  • 1 month ago

    Cash value and surrender value are not the same thing.  

    If there were paid up additions here, the DB is probably higher at this point...

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  • Eva
    Lv 7
    1 month ago

    It is unlikely that the cash value is larger than the death benefit. If you take the cash value as a loan, that amount is subtracted from the death benefit when it is paid out. If you cash in the policy, it is cancelled and their is no more death benefit. If you cash it in, you will pay taxes on a portion of the money.

  • L'nya
    Lv 6
    1 month ago

    John 5:28,29; John 17:3;Matt 24:14 jw.org

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