Subject to the contestability provision in the policy, the death benefit is guaranteed to pay out provided that scheduled premiums have been paid on time and policy is in force at the time of the insured’s death. The death benefit and payout amounts may be affected by loans, withdrawals, and other policy changes. Guarantees are based on the claims-paying ability of Transamerica Life Insurance Company.
A portion of each monthly payment and a portion of the final lump sum are reportable as interest income. The policy illustration provides the tax-reportable percentage for each monthly income payment and the final lump sum based on a 3% guaranteed minimum interest rate and the illustrated face amount. Upon the insured’s passing, the actual taxable portion of each monthly payment will be calculated and communicated to the beneficiary(ies) based on the actual payout amounts. The taxable portion of the final lump sum payment will be determined when the payment is made.
Transamerica Life Insurance Company and its representatives do not give tax or legal advice. This material is provided for informational purposes only and should not be construed as tax or legal advice.
Insurance products offered by Transamerica Life Insurance Company, Cedar Rapids, IA 52499