J is 35-years old and looking to purchase a whole life insurance policy. Which of the following types of policies will provide the most rapid growth of cash value?
A. Straight Life
B. 20-pay Life
C. Life Paid-up at Age 70
D. Increasing Term to age 65
Answer (2)
The 20-pay Life insurance policy is the best option for J to maximize the growth of cash value. This policy allows for premium payments over only 20 years while providing lifetime coverage. Other options either extend premium payments or do not accumulate cash value at all. ;
J should choose option B, 20-pay Life insurance policy, as it allows for rapid growth of cash value by requiring premium payments for only 20 years. This leads to a more significant accumulation of cash value compared to other options. The policy remains active for J’s entire life without further payments after 20 years.
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