Higher Premiums
As permanent life insurance program is designed to pay out a benefit in all cases, the premiums are much higher than for term assurance, which can be regarded as pure death benefit with no investment element. Thus many people select term insurance for its low cost, and they may invest the difference in separate investments. Another commonly used tactic is to utilize the slow, steady, growth within the cash value of permanent life insurance as a conservative savings strategy to hedge against the risk of the market.
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Famous quotes containing the word higher:
“A man should have a farm or a mechanical craft for his culture. We must have a basis for our higher accomplishments, our delicate entertainments of poetry and philosophy, in the work of our hands.”
—Ralph Waldo Emerson (1803–1882)