Paid-up additions (PUAs) in whole life insurance allow policyholders to use dividends to buy extra coverage without increasing premiums or undergoing new medical exams. PUAs increase the death benefit and accelerate cash value growth, potentially helping pay off the policy sooner. However, overfunding may trigger tax issues. Alternatives include cost-of-living, guaranteed insurability, and term life riders. Dividends can also be taken as cash or used to reduce premiums.
Continue to full article
