Whole Life

Permanent life insurance is sold to provide guaranteed protection over long periods of time (usually one's lifetime). It is used to provide, not only a sum of money to the insured's beneficiaries at death, but also an income stream to dependents, making it possible to maintain the quality of life they have come to enjoy. People also use permanent life insurance as a means of accumulating money through cash values for their own use in later life. This accumulation is referred to as a Living Benefit.

Whole life insurance offers permanent life insurance protection with guaranteed premiums, cash values and death benefits.

This policy may share in the Association's surplus through the payment of dividends. Dividends are based on the Association's year-by-year experience, and depend upon items such as the general level of interest rates, the amount and timing of benefit claims paid by the Association, and the Association's operating expenses. Dividends are not guaranteed and are subject to change by the Association.

Dividends increase the value of your life insurance policy in one of two ways:

• By increasing your policy's cash value and/or death benefit; or,
• By reducing the out-of-pocket cost of your policy.

You have options for the use of the dividends generated by the policy. These options include:

• Paid-up Additions: dividends are used to purchase additional insurance protection. This additional insurance has a cash surrender value and may generate its own dividends.
• Cash: sent to you each year in the form of a check.

A policy's cash value (Living Benefit) is guaranteed. It is the amount the policyholder will receive at any time if the policy is surrendered. It is, however, reduced by any outstanding loan balances. The policy has a loan provision which allows you to borrow against the cash value of your policy. Ninety-two percent of the cash value may be borrowed, subject to a loan interest rate of 8%.