Can I borrow from my life insurance policy?

Question

For context, I have permanent life insurance with accumulated cash value and am considering using some of it for a major expense or retirement income. For context, I do not fully understand loans, withdrawals, interest, or lapse risk. The complication is that I want to understand the contract before I buy, cancel, replace, or rely on the coverage.

Soradin · Accepted Answer

Many cash value policies allow loans, subject to available value and policy terms. For a coverage review, loans and withdrawals from permanent life insurance reduce cash value and can reduce the death benefit. Use the written policy and current values to evaluate the coverage, instead of treating a sales presentation as the controlling document. The written policy and a current illustration should anchor the review, then have a licensed insurance professional provide a written explanation of the relevant guarantees, exclusions, riders, and surrender restrictions.

Can I borrow from my life insurance policy?

Soradin

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