Permanent Life Insurance

Marshall & Sterling Insurance can work with you to develop a group life insurance program that meets your company's needs, budget, and company culture–now and as the company grows.


Like owning property, owning permanent life insurance is usually an appropriate way for people to meet long-term needs. Over time, it may be the least expensive form of life insurance since premiums are fixed and it builds value. Plus, this cash value accumulates on a tax-deferred basis.

Types of permanent insurance can be likened to types of mortgages. Whole Life requires a higher payment but has the most guarantees. Other permanent products require less premium but contain a degree of uncertainty

What is it?

Permanent life insurance is distinguished from term insurance in several ways:

  • While term insurance provides protection only for a specific period of time, permanent insurance can provide protection for the entire lifetime of the policy owner, or in certain instances, up to a specific age - at which point the insurer will pay the policy owner the cash value.
  • Permanent life insurance policies can build a cash value - money that can be borrowed against and, in some instances, withdrawn to help meet future goals, such as paying for a child's college education. Note: A policy owner will usually have to wait a period of time after the purchase of the policy for sufficient cash value to accumulate from which to borrow against. If the unpaid interest on the loan plus the outstanding loan balance exceeds the amount of the policy's cash value, the policy and all coverage will typically terminate.
  • Permanent life insurance policies enjoy favorable tax treatment. Cash value growth is generally on a tax-deferred basis, meaning that no taxes are paid on any earnings in the policy so long as the policy remains in force. And money can be taken out of the policy without having to pay taxes, since policy loans generally are not considered taxable income, and withdrawals generally can be taken up to the amount of premiums paid without being taxed.
The two general types of permanent life insurance policies are Whole Life, a dividend-paying policy, and Universal Life, a flexible policy.
Who is Permanent Life Insurance for?
  • People who know their need for life insurance is long term.
  • People who want to accumulate a cash value to provide funds for education, retirement or other future goals.
  • People who want to take advantage of the tax-favored treatment of cash value life insurance policies.
Benefits:
  • If the policy is cancelled, the accumulated cash value can be used by the policy owner as they choose.
  • Earnings, and certain withdrawals and loans, may qualify for tax-favored treatment.
  • Over time, permanent insurance may be more economical than term insurance since premiums do not increase with age and the policy can build a cash value. * Policy loans and withdrawals provide access to cash value.