shopify analytics ecommerce
tracking

Dividends Earned On Life Insurance

When you buy a participating life insurance policy you earn dividends on your policy.

Policies earn them when the company performs well and should not be confused with those earned from ownership of stock.

They keep operating expenses down and maintain profitable investments.

They are not guaranteed. You accumulate them on whole life policies or any participating permanent life insurance policy.


What will happen to your family when you die? Would they be provided for? Life Insurance is the solution and we can help. Compare Multiple Quotes from Highly Ranked Carriers and Save up to 70%! Getting your quote is easy and FREE. Click Here To Get Started


Participating Life Insurance May Earn Dividends

Mutual Life Insurance companies are owned by their policy owners. They have no stockholders.

The insurance company sets premium rates by anticipating the costs of contractual obligations, unexpected losses and operating expenses.

If there is an excess in earnings, policy owners participate equitably in this surplus.

How Are They Determined?

They are determined by considering the following factors:

  • Mortality savings. When there are less death claims than projected.
  • Saving on operating expenses. When the operating expenses are lower than anticipated.
  • Investment earnings higher than projected. This occurs when earnings exceed amount required for guaranteed death benefit reserves and any other contractual agreements.

Policy loans do affect dividends.

How To You Use Them?

  • They can be used to reduce premium. This is a choice that is usually at the time you purchase the policy.
  • They can be used to purchase paid up additions. That is to automatically buy additional insurance of the same type as the base policy.
  • They can be left to accumulate at interest, based on whatever rate the company is paying at a given time.
  • They can also be paid in cash. If you choose this option the life insurance company will send you a check each year.

The Tax Effects.

Because they are a return of premium they are not usually taxable.

However, whenever they earn interest and together they exceed the premiums paid they are subject to taxes.

Let us examine how dividends are calculated.


Can you think of anything more important than your Family's Security? What would happen to Your Family if you died? Would they be provided for? Compare Quality Life Insurance Quotes from Quality Carriers and Save. Click Here To Learn More


Home | Whole Life Insurance Rate | Investing With Whole Life Insurance | Old Life Insurance Policies | Universal Life Insurance | Variable Universal Life Insurance | Variable Life Insurance Quote

Tools And Resources

Life Insurance Need Calculator

Recent Articles

  1. Whole Life Insurance Online Quote

    Getting a whole life insurance online quotation can be a very interesting and exciting thing.

    Read More

  2. Insurance Leads | Auto | Home | Life | Health | Long Term Care

    The insurance agents most important stock in trade is a source of good reliable insurance leads.

    Read More

  3. Life Insurance Quotes - Policy Provisions, Explanations And Quotes

    Life insurance hub is a service dedicated to assisting you in understanding life insurance quotes and how to apply them to your personal life insurance needs.

    Read More

  4. Life Insurance | Term Insurance, Whole Life, Universal Life

    Shop And Compare Term Life, Whole Life And Universal Life Insurance Rates From A Highly Rated Carrier

    Read More

  5. Term Life Insurance Quotes - Examine Great Term Life Quotes

    Getting term life insurance quotes online has become common practise with people in search of life insurance protection for their families and in many cases for their business.

    Read More