What are the pros and cons of modified whole life insurance?

Question

I'm really confused by all this insurance biz. What I'd really like to know is whether I'd be losing out alot by cashing in my whole life policy that I've had since 1985. The total death benefit is about $12,400. The cash value is $2400 which I could really use now. Would I be losing much since my job automatically provides basic life insurance to me which covers $38,000? I also have additional voluntary AD&D which covers another $38,000?

Answer 1

My suggestion is trying to get as much resource as you can before making final decision,here is a good one.http://insurance.online-frees.info/insur...

Answer 2

Any time you cash in a long time policy like that you lose.   You may also have a taxable gain on the policy.   Ask your agent or insurance company about that before cashing it in.   You can also take a loan instead of cashing it in or ask if the policy has dividends that you can withdraw.  

There is only a taxable gain if you cash it in but not if you just withdraw dividends or take a loan.

Life Insurance today is much cheaper.  So, if you cash it in get another cheaper term policy.  

Answer 3

I always encourage people not to rely on the life insurance they get from their employer for their financial protection.  Usually they are not portable, so if you lose your job you lose your coverage.  

If you need life insurance protection then I would suggest that you go and try to find another cheaper term life insurance policy before you lapse your whole life policy.  If you are still healthy enough to qualify for a new policy you can probably lower your premium with a good competitive term policy with a higher face amount than $12,400 and use the $2,400 for your immediate needs.