participating policy

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Last updated

July 23, 2026

Quick Summary

Participating policies are a type of life insurance that returns dividends to the policyholder. These dividends can be substantial, potentially amounting to 20 percent of the premiums paid.1

Policyholders have several options for how to use these dividends:
* They can be accumulated in cash and left with the insurer, earning interest.1
* They can be used to purchase additional life insurance coverage.1
* They can be applied to reduce future premium payments.1
* They can be used to pay off the contract sooner than originally scheduled.1

Life insurance itself is a method for large groups of people to share the financial burden of death by providing funds to beneficiaries of those who pass away. It is a significant channel for saving and investment in developed countries.21

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…life insurance policies, known as participating policies, return dividends to the insured. The dividends, which may amount to 20 percent of the premiums, may be accumulated in cash left with the insurer at interest, used to buy additional life insurance, used to reduce premium payments, or used to pay up…
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…life insurance policies, known as participating policies, return dividends to the insured. The dividends, which may amount to 20 percent of the premiums, may be accumulated in cash left with the insurer at interest, used to buy additional life insurance, used to reduce premium payments, or used to pay up…
Read More