Borrowing Money From Usaa Life Insurance: Is It Possible?

Borrowing money from a life insurance policy can be a quick and easy way to get cash. However, there are a few things to know before borrowing from your USAA life insurance. Firstly, it's important to understand that you can only borrow against a permanent life insurance policy, which includes whole life insurance and universal life insurance. Term life insurance, on the other hand, does not have a cash value and is not suitable for borrowing against. USAA offers both whole and universal life insurance policies, and you can borrow from them if they have accumulated enough cash value. The amount you can borrow will depend on the cash value of your policy and the rules set by USAA, but it's typically up to 90% of the cash value. It's worth noting that borrowing from your life insurance policy will reduce the death benefit, so it's important to consider the potential risks before taking out a loan against your USAA life insurance.

USAA's Your Own Cash Surplus plan

USAA's life insurance products are available to the general public, although most of its other insurance products are only available to members of the military and their families.

The monthly premiums for permanent life insurance are higher than for term life insurance. However, money paid into the policy that exceeds the cost of insurance builds up a cash value that is part of the policy. This cash value can be borrowed against.

The purpose of the cash value is to offset the rising cost of insurance as the policyholder ages, so that premiums remain level throughout life and do not become unaffordable in later years.

It is important to note that borrowing against a life insurance policy can have financial risks. If interest payments are not made, the policy could lapse and the loan amount could become taxable. Additionally, if the insured person passes away, the loan amount and any interest owed will be subtracted from the death benefit paid to the beneficiaries.

USAA's Your Cash Assurance plan

USAA's life insurance products are available to the general public, even those without a military connection. However, membership provides access to additional financial products and advice. The company caters specifically to U.S. military members (including reserves), veterans, and their families, offering various benefits and add-ons tailored to their needs.

One unique feature of USAA's life insurance is the option to add $100,000 in coverage if you experience a significant life event, such as having a baby, getting married, or buying a house between the ages of 18 and 35. Additionally, active-duty military personnel receive benefits like a $25,000 payment for severe injuries and guaranteed insurability upon leaving the military.

USAA's website provides detailed information about its policies, including term lengths, coverage amounts, issue ages, and more. You can also get an online quote without providing personal contact information. The company offers a mobile app and phone support for managing your policy.

It's important to note that some of USAA's policies are not available in all states. For example, the universal life policy is not offered in New York, and the guaranteed whole life policy is not sold in Montana.

Overall, USAA's Your Cash Assurance plan offers a comprehensive suite of life insurance options with features that cater to the specific needs of military personnel and their families.

USAA's Level Term V insurance

• Coverage during wartime, which is often excluded from life insurance policies.
• A $25,000 payment for severe injuries sustained while on active duty.
• Guaranteed coverage after leaving the military.
• The option to add $100,000 in coverage if you have a baby, get married, or buy a house between the ages of 18 and 35.
• The option to replace your service members' group life insurance (SGLI) with a USAA term life policy if you leave the military.

USAA also offers whole and universal life insurance policies.

USAA's Simplified Whole Life insurance

USAA's whole life insurance is a type of permanent life insurance that can provide lifetime protection. It has fixed premiums, a guaranteed death benefit (as long as the premiums are paid), and cash value. With each premium payment, a portion of the money goes toward cash value, which grows based on a fixed interest rate. You have the option to withdraw or borrow your cash value while you are living, but your death benefit will be reduced by the amount you take out (unless you pay back a policy loan).

USAA's Universal Life Accumulator policy

The policy is issued by John Hancock and is not available in New York.

To apply for a Universal Life Accumulator policy, you must answer a health questionnaire and undergo a medical exam.

Frequently asked questions