The basic features of permanent policies are:
Non-forfeiture options are available to you if you miss or decide to discontinue paying premiums on your policy. The options will allow you to keep the policy in force or take a cash settlement.
- Level premiums: most policies have premiums that remain level over the policy’s lifetime. This doesn’t mean that the payments remain the same. It means that the premiums you pay in the early years of the policy when you are younger are higher than the risk you represent to the insurer, and when you are older, the premiums you pay are lower than the risk you represent.
- Cash values are the amount of money built up in a permanent life insurance policy. You can use the cash value to boost your death benefit, pay your premiums, supplement your retirement income, or take out a policy loan.
- Participating policy dividends: participating policies share in the financial experience of the insurance company and receive annual dividends. Non-participating policies do not.
Easy answer provided by FSCO (Financial Services Commission of Ontario)