whole life living benefits
Permanent life insurance may be considered a potential funding source for long-term care costs because of its cash values. Policy-owners can typically access their cash values in the following ways:
When withdrawing money from inside the policy keep in mind that you can withdraw up to 82% of the cash value, income tax free. While keeping the policy the policy in force for the beneficiaries.
The drawback of using life insurance cash values as long-term care funding sources is that it impairs the policy’s ability to fulfill its original function—that of providing a death benefit to the insured’s heirs. Presumably, the insured’s survivors are going to need that money, or the policy wouldn’t have been purchased in the first place. However, accessing cash values has the effect of reducing the policy’s death benefit: