What is cash value of paid up additional insurance

Even if for some reason no dividends were paid ever again by your mutual insurance company, the cash value of a paid-up addition MUST equal its death benefit by age 121. This contractual provision inside every Whole Life policy causes your cash value to grow on a daily basis converging on your death benefit.

What does cash value of paid up additions mean?

Definition. Paid-up additions (PUAs) are an optional feature available on some types of whole life policies. PUAs refer to small increases in the death benefit (and cash value) of a life insurance policy for which no ongoing premium is due.

Do paid up additions have cash value?

Each paid-up addition (PUA) has its own death benefit and cash value, and also earns dividends. This makes them an effective way to increase the cash value and death benefit over time without medical underwriting or increasing the premium payment.

What is the cash value of a paid up life insurance policy?

Cash value is a savings component typically included in permanent life insurance policies. Depending on your particular policy, the cash value can grow at a fixed or variable interest rate over time. You can borrow against your policy's cash value in the form of a life insurance loan.

What is paid up additional insurance?

Paid-up additions are increases in coverage that you can purchase using dividends generated by a whole life policy (when they are declared by the company). Since this coverage is already paid-in-full, there is no increase in your premium payments.