Putting money aside for a rainy day, saving for our retirement, and making sure our loved ones are cared for should something to happen to us is how most of us were brought up. These are some of the basic values in life. It's something one does, something that makes sense, and something that is more than just an obligation. This system worked until the collapses in the financial markets wiped out trillions of dollars in savings and investments. The markets will eventually recover, but it'll be a long time until they are trusted again. And that's why a lot of people are asking for life insurance information today, even those who never considered it before.



Why would life insurance all of a sudden look interesting? Why are people educating themselves about term, whole, universal and variable insurance at a time when financial markets are in turmoil and faith in investments of all kinds has been shaken? The answer is simple. We still need security, we still need to look into the future, and our loved ones still depend on us. And with stocks and bonds and mutual funds so uncertain, many people are looking for investments they can truly rely on. And for many, life insurance is the answer.

Now realize that there are many types of life insurance. In some types, you have coverage, but you're not actually accumulating funds. That's not what I am talking about. What's interesting as an alternative to investing in a shaky market is setting up what's called whole life insurance and is also known as cash value or permanent life insurance. In this type of life insurance you get the death benefit protection all types of life insurance offer, but you also accumulate money at the same time. It's like saving money and getting insurance at the same time.

There are pros and cons to whole life insurance.

On the positive side, you are accumulating money and building wealth rather than just paying premiums. As with retirement savings, there is also a tax deferral aspect that, depending on your income bracket and circumstances, can make whole life insurance even more attractive. Another nice feature is that you can make loans against the cash value of the insurance or even cash it in. Premiums are fixed and known, and policies and benefits are guaranteed.

On the negative side, whole life insurance, since it still represents a risk to the insurance company, is not a very lucrative investment vehicle. Or at least it wasn't in the past when the financial markets offered seemingly every-increasing returns. All this has changed now, and getting a fixed cash value can look quite interesting even if the terms aren't that attractive and the costs seems high.

The key to it all is information. If you've dismissed life insurance in the past as unnecessary or too expensive, the situation has changed and getting some good, personal knowledge about life insurance seems like a smart thing.