Any life insurance policy that is participating can pay dividends.
The most ubiquitous type of life insurance to pay dividends is whole life insurance, but it is not the only type f life insurance that can be participating (pays dividends).
It's important to note that just because a policy is participating, there is no guarantee that it will pay dividends in any given year. Dividends are paid as a result of surplus (excess earnings) with the insurer on the product issued.
A dividend is a portion of the insurance company's profits that you receive just by having a participating policy with that company. Policies that pay dividends are usually participating Whole Life. Dividends are not guaranteed, because they are only paid if the company makes money that year. But they are not taxed, because rather than looking at them as profit to you, they are looked as a refund for over payment of premium.
Paying life insurance dividends can be paid on any type of policy from any participating life insurance carrier. The most common companies that pay dividends are called mutual insurance companies. Some of the more common names of mutual insurance companies are State Farm, NY Life and Northwestern Mutual. Mutual insurance companies consider the policyholders part owners of the company and share a portion of the profits as dividends. You may or may not receive a benefit based on the year's profits.
You may find mutual company premiums a bit more expensive than none mutual companies with an expectation of paying their dividends. When purchasing a life insurance policy you should find the best product at the best price to cover your unique situation, not on who pays a dividend or not.
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The most ubiquitous type of life insurance to pay dividends is whole life insurance, but it is not the only type f life insurance that can be participating (pays dividends).
It's important to note that just because a policy is participating, there is no guarantee that it will pay dividends in any given year. Dividends are paid as a result of surplus (excess earnings) with the insurer on the product issued.
You may find mutual company premiums a bit more expensive than none mutual companies with an expectation of paying their dividends. When purchasing a life insurance policy you should find the best product at the best price to cover your unique situation, not on who pays a dividend or not.