Face Amount
The face amount of the life insurance policy is the amount stated on the policy that is payable in the case of the death of the policy holder. The face amount does not take into consideration any amounts that are payable if the death is accidental. It also does not include the benefit of any dividends that are received during the life of the policy.
When shopping for life insurance, the face amount is what you use to determine how much coverage you need. A $500,000 policy will have a face amount of $500,000, and could be worth more with the application of policy dividends of accidental death benefits. But since neither of those conditions is guaranteed, it is important to choose coverage based on the face amount, to ensure that you get enough coverage for your family. Try not to rely of the value of the dividends your policy might earn when calculating your needed coverage.
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