Sara Routhier, Managing Editor and Outreach Director, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming world o...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insur...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years

UPDATED: Oct 18, 2021

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The Brief

  • Life insurance policies with a cash-out option can be of use to you while you’re still alive
  • You can take out loans on your policy that are tax free
  • You can shop online to find the best insurance company for you

Life insurance with a cash-out option offers you the security of planning for your loved ones’ financial future after your death while also having the possibility of accessing that money while you’re still alive if needed.

After signing up with affordable life insurance companies that allow you to cash out, you can use your policy to accomplish any number of goals, like paying off the mortgage or starting a new business.

As this is one of the most popular types of life insurance, you can find life insurance quotes from life insurance companies that allow you to cash out with the click of a button.

Start comparing life insurance rates from life insurance companies that allow you to cash out right away. Enter your ZIP code above to get free quotes from life insurance companies that allow you to cash out today.

Where can I buy life insurance with a cash-out option?

If you are looking for a new life insurance company, life insurance companies that allow you to cash out, like those listed below, certainly deserve your consideration.

  • Penn Mutual
  • New York Life
  • MassMutual
  • Guardian Life Insurance Company of America
  • Northwestern Mutual
  • Foresters
  • American United Life Insurance Company

With life insurance that you can cash out, you are able to use that cash value in any way that you want while you are alive.

All of these companies offer life insurance policies, including whole, variable, and universal, that build cash value through the production of dividends.

Now, while these life insurance companies provide top-quality products, each has its own selling points, so it’s in your best interest to do some research to determine which will be best for you and your family.

Penn Mutual

With an A.M. Best rating of A+, Penn Mutual is a titan in the insurance industry. It is also exciting to note that its policies have been able to produce incredibly high dividends.

But that’s not the only factor that makes Penn Mutual unique.

Sports fans may be interested to learn that Penn Mutual is a strong supporter of collegiate rugby.

In fact, Penn Mutual sponsors National Collegiate Rugby (NCR), an organization that supports the development of college rugby throughout the United States.

Rugby fans, as well as people with no interest in sports, can access great living benefits through a policy with Penn Mutual.

However, since Penn Mutual doesn’t share its pricing mechanism online, you’ll need to request a quote to discover if Penn Mutual’s rates fit your budget.

New York Life

If you only want to work with a financially strong company, you can’t go wrong with New York Life, which has an A.M. Best rating of A++. New York Life also has a variety of whole life insurance products on hand.

Founded in 1845, this company has long provided its clients with desirable dividends and great coverage.

You can rest easy after purchasing a policy from New York Life, because not only will your family have a financial safety net, but you will too.

You can also get coverage from New York Life without breaking the bank. For just $15 a month, the company advertises that you can obtain $250,000 in coverage.

MassMutual

Like New York Life, MassMutual also has the honor of holding an A++ rating from A.M. Best. Its most popular product is whole life insurance because the dividends produced by this product are some of the highest in the business.

MassMutual also stands apart from the pack because it has both non-direct recognition and direct recognition policies available for purchase.

Dividend growth tends to be rather slow with a direct recognition whole life insurance policy because the insurance company employs the policy’s cash value as collateral for loans.

Bear in mind that a direct recognition policy could provide you with less cash value than a non-direct recognition policy.

But the rates offered by MassMutual are tempting.

You could potentially get $250,000 in coverage for $11 per month, but don’t forget to always request at least three life insurance quotes online so you can compare offers from across the market.

Guardian Life Insurance Company of America

Stable and reliable, the Guardian Life Insurance Company of America is another excellent company that has earned an A++ rating from A.M. Best.

While this company has a variety of life insurance products that are known to produce solid dividends, like Penn Mutual, you must request a free quote from the company directly to learn about its rates.

However, if you want to learn more about this company’s customer service and how it operates, take a look at Guardian Life Insurance reviews so you can make an informed decision about where to buy life insurance.

Northwestern Mutual

Boasting an A++ rating from A.M. Best, Northwestern Mutual is an excellent choice for individuals looking for a company that offers life insurance products that you can cash out.

One of the original mutual companies, Northwestern Mutual is run by its policyholders, and you could potentially purchase $500,000 in coverage for about $25 per month. As with all life insurance, rates will vary from person to person.

Foresters

A bit of a dark horse, Foresters is an A.M. Best A-rated company that supplies its clients with very high participating dividends; it is also a company that works to make the world a better place.

Foresters is a fraternal organization, which, according to the National Association of Insurance Commissioners (NAIC), means that it is not-for-profit and must offer life, health, and other related insurance products to its members.

Fraternal organizations must conduct charitable acts and take part in other works that benefit the public good.

Foresters is also very affordable; you have a chance of purchasing $250,000 in coverage for just $11 per month.

American United Life Insurance Company

American United Life Insurance Company has an A+ from A.M. Best, and you can get excellent policies from this company.

Some of these policies even include a long-term care benefit, which is incredibly helpful since people are living much longer these days.

A long-term care benefit allows you to use your life insurance policy to cover the costs associated with nursing home care, health care at home, and personal care for individuals age 65 or older.

You can also use this benefit if you have a chronic illness or a disability that means you require constant assistance.

Another nice touch is that you can also access your life insurance policy via the American United website; however, you won’t be able to catch sight of this company’s rates online.

American United requires potential clients to reach out directly for a quote.

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How can you cash out a life insurance policy?

Usually, when you own a life insurance policy, you make a payment once a month or once a year so your beneficiaries can receive financial compensation upon your death.

But with a life insurance policy that you can cash out, you can benefit from owning a life insurance policy too.

If you need to cash out your policy for an emergency or to pay off a car loan, for example, you can do so through:

  • Selling the policy
  • Withdrawals
  • Taking out a loan

You are also allowed to surrender a life insurance policy in exchange for its cash value. It is important to remember that if you take out a loan on your policy, you do not need to pay taxes on it, nor do you have to pay it back.

Now, bear in mind that if you don’t pay back the loan, your death benefit will be diminished.

Life Insurance Companies That Allow You to Cash Out: The Bottom Line

A life insurance policy that allows you to cash out can be an excellent financial tool in case you find yourself in some financial trouble while you’re alive, or if you simply want to fund a new venture.

Since rates tend to be higher with these policies, you may think that you cannot afford to buy life insurance. But life insurance companies that don’t allow you to cash out are typically cheaper than those listed above.

This empowers nearly everyone to provide for their families after they’ve passed.

But if you want a policy with a cash-out option, you have many financially strong companies to choose from, like Penn Mutual, Foresters, and more.

If you’re excited to purchase life insurance, enter your ZIP code to get free quotes from life insurance companies that allow you to cash out today.