Dividends Can Enhance Performance

Non-guaranteed company issued dividends offer the ability for your policy to supplement its growth.

Dividends are non-guaranteed amounts that some life insurance companies, particularly mutual insurers like Guardian, pay policyholders annually based on the company's operating and investment results. You can decide how to apply dividends to enhance your policy, among several choices:

• The most commonly selected option is to apply dividends to purchase "Paid-Up-Additions" (PUA). A "Paid-Up Addition" is guaranteed permanent paid-up participating life insurance. It essentially adds to the face amount of the policies' coverage so that each year, as dividends are declared, more and more PUA's are purchased and the policy coverage increases without any further out-of-pocket costs for the policyowner.
  Selecting this choice can:
• Increase your overall policy's face value, offering greater protection.
• Increase guaranteed cash value growth above the specified amount.
• Increase the amount of future dividend payments to you.
• Taking this choice can also increase the death benefit gradually to offset inflation, without additional premium cost.
• Dividends may be received in cash or applied to reduce your premium payments.
• Dividends may be used to purchase temporary increases in death benefit, through term insurance. Or they may accumulate on a tax-advantaged basis inside your policy, earning interest.
• Dividends may be used to pay back an existing loan on the policy.

Graph provided from "The Whole Story of Whole Life" by Mr. Clifford Kitchen, CLU, ChFC, CFP, CFA, MSFS. The Guardian Life Insurance Company of America. 2005