Dividend Options

Paid-up additions — The paid-up additions option uses each dividend to buy small amounts of fully paid-up whole life insurance, thereby increasing both the death benefit and the cash value without requiring evidence of insurability. It is one of the standard dividend options, along with cash, accumulation at interest, reduced premium, and one-year term. The purchased additions are paid up and cannot lapse, so they add permanent value to the policy. This option is popular with clients who want their coverage to grow over time using the policy's dividends. The additions also earn future dividends themselves.

National insurance concept

Paid-up additions, in which the dividend purchases additional paid-up insurance — The five standard dividend options are cash, accumulation at interest, paid-up additions, reduction of premium, and one-year term (with a cash or paid-up additions basis). Under paid-up additions, the dividend buys additional fully paid-up life insurance that increases the total death benefit and cash value. This option is popular because the additions themselves earn future dividends.

National insurance concept