Non-participating whole life policies are a form of coverage where there is a guaranteed cash value, but they do not pay out an annual cash dividend. These types of policies mainly have fixed premium rates, but recently, there has been a trend towards adjustable premium rates — with the adjustable premium rates tied to the interest rates.
If interest rates are low, premium levels would either stay the same or go higher. If interest rates go up, premium rates go down. While this can result in lower premium rates than other products, with the current low interest rate trend, consumers are more likely to see rates go up as well. Since most companies do not have a premium cap, there is no fixed limit to how high they can charge.(Which Whole Life Policy is Best? continued...) | 14 comments