Convert "Cash Value" of Life Ins to Coverage?

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Joined: Thu Mar 08, 2012 7:31 am

Convert "Cash Value" of Life Ins to Coverage?

Post by windaar » Sat Feb 02, 2013 8:05 am

Before talking with insurance agent I'd like to get info/advice here. My wife has a whole life policy started by her parents when she was young. Premiums currently paid by dividends, so we've just left it alone so far. The "cash value" is irrelevant to us, we never plan to try to access it, and we understand that it is of no value or use to eventual beneficiaries. Ideally, we would like to just convert the "cash value" to increased coverage. Is this generally possible, and are there tax or other issues that we should be aware of before looking into this?

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Re: Convert "Cash Value" of Life Ins to Coverage?

Post by dhodson » Sat Feb 02, 2013 8:59 am

Have them run an illustration changing dividends to buy paid up additions instead of paying premium. Also ask if you can add a rider to buy additional pua. Many policies also let you buy 1 year term with the dividend although I don't think that's a great deal in my opinion and I'm not in the industry.

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