The question is that's my money, why I should pay so much interest to take my own money for urgent use and top up back..
2006-10-14 16:28:12 · 4 answers · asked by Drone 7 in Business & Finance ➔ Insurance
If you want to get a lower interest rate, borrow money somewhere else.
The money you have in your insurance policy is a very, very bad investment.
You should buy term insurance and then take the money you saved in premiums and invest it in a place where you can take it out without having to pay it back with as much penalty.
The cash value in your life insurance, while available for loans, is not really intended to be a liquid account like you are using it.
2006-10-14 16:43:27 · answer #1 · answered by markmywordz 5 · 0⤊ 0⤋
Hi, your friendly insurance guy here again. :)
What appears to have happened is that you are taking the cash value out in the form of loans instead of surrenders of paid up additions.
When you take a loan out you are borrowing against the cash value. When you surrender paid up insurance you are "cashing in" some of the insurance rather than getting a loan.
Loans against the value of insurance contracts tend to have moderately high interest rates. They won't be as high as credit cards, but will still be high enough to work against you as the owner.
If you are in that situation I recommend paying the loan back ASAP if you want to keep the insurance. If you do not, eventually it might make the policy lapse if you do not.
If you are young and healthy, it might be wiser to replace that contract with a new policy rather than pay back the loan if you have sufficient value to cover the loan.
2006-10-15 00:54:40 · answer #2 · answered by Bright Future Penguin 3 · 0⤊ 0⤋
You have to pay the insurance company for their service. Use a mattress to save your money if you do not want to incur charges for operating expenses.
2006-10-14 23:36:28 · answer #3 · answered by Kelly T 4 · 0⤊ 0⤋
Haven't you heard of piggy banks?
2006-10-15 18:06:12 · answer #4 · answered by Anonymous · 0⤊ 1⤋