Whole life insurance as the name implies, is an insurance that has a death benefit which lasts until the day you die. It is very similar to a savings or an investment account which becomes a cash asset over time.
The main purpose of whole life insurance is to ensure that financial resources are made available for your children and loved ones when they need to get to that point where they can fend for themselves after you die.
Whole life insurance might have many upsides which may include providing lifelong protection, helping you accumulate cash value and many other benefits; it also has its downsides. For instance, it’s much more expensive than other types of insurance, and it might take you many years before you enjoy many of its lining benefits. As explained on reviewsbird.co.uk, most people don’t even need coverage for their entire life, so this insurance might be a bad investment to start with.
To further buttress our point, check out these reasons why whole life insurance might be a bad investment for you.
· It Is Undiversified
It is undiversified in the sense that companies that offer life insurance only give you the opportunity to invest a large amount of money in one company while relying entirely on the company’s benevolence to give you good returns. After the insurance company has made their own investment, they will then decide on what portion they will give to their shareholders. This leaves you completely at their mercy. … Read More