No, unfortunately, you cannot take a loan on a term life insurance policy. That is because term life insurance does not build up a cash value, and thus, there is no money to borrow from within the policy. The premiums you pay for term life go only to providing a death benefit.
Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
No, term life insurance does not build cash value to borrow against. You can only borrow from a policy that builds cash value, which would be a permanent insurance policy such as Universal Life or Whole Life insurance.
If you have a term policy, you may be able to convert all or a portion of the coverage to a permanent program that can build cash value (you can also look at securing a new policy to supplement or replace the existing one as it may offer better guarantees and/or lower premiums than the conversion option for the existing coverage).
I hope the information is helpful - please feel free to contact me for help with your coverage and if you have any other questions. Thanks very much.
President, Lane Independent Agency, Southern California
No you cannot. That is a problem with Term. It may cost less to start, but it builds up no cash value. With either Whole or IUL you can build up substantial cash value, frequently bringing the cost down over time versus term. I recommend Equity Indexed Universal Life, which is available from Premier Financial Alliance, from National Life Group. It does not go down, only up, with the stock market. You should talk with your agent working with PFA. Thank you. GARY LANE.
Unfortunately, term life insurance does not have any cash value to accumulate so there is no money to borrow. Cash value policies such as whole life and universal life do have cash value to make loans against. This is why cash value life insurance policies are considered permanent insurance and term life insurance is considered temporary insurance.
Insurance Adviser - Broker, SC Insurance Services, Oahu, Hawaii
At no time in the life of Term policies do they have cash value to borrow against, so no you cannot borrow against a term policy. Additionally you can not use a term life policy as collateral for a loan as you can with a Whole Life policy.
Credit term policies are designed to pay off a debt in the case of death of the debtor before the credit is repaid.
On the other hand, Whole Life policies have cash value, grow wealth tax free, may be used as collateral and may be borrowed against. Contact me for more information.
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If you have a term policy, you may be able to convert all or a portion of the coverage to a permanent program that can build cash value (you can also look at securing a new policy to supplement or replace the existing one as it may offer better guarantees and/or lower premiums than the conversion option for the existing coverage).
I hope the information is helpful - please feel free to contact me for help with your coverage and if you have any other questions. Thanks very much.
Credit term policies are designed to pay off a debt in the case of death of the debtor before the credit is repaid.
On the other hand, Whole Life policies have cash value, grow wealth tax free, may be used as collateral and may be borrowed against. Contact me for more information.