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What is Value-Added Whole Life?

Value-Added Whole Life gives you the protection of Permanent Life Insurance plus the cash value growth found in Interest Sensitive Life Insurance. Your insurance grows in two ways: cash value accumulation and an increasing death benefit. A great inflation protector if you start early.

How does it work?

Every month your premiums pay the cost of insurance and the low administrative cost. The remainder of your premiums adds to your account which earns interest compounded monthly to equal the Association's crediting rate. When your cash value builds to an amount sufficient to support higher insurance values, your death benefit increases, but your premiums never increase!

What is the crediting rate and how is it established?

Our current crediting rate for 2007 is 7.1%. Since 1986 our members have benefited from an above average crediting rate. The crediting rate is based on the Association?s annual investment performance. Professional investment management and a long-term perspective generate consistently high returns. Value and safety underlie our investment philosophy.

How is the association able to offer such a high crediting rate?

As a non-profit association, we do not have a commissioned sales force and our administrative costs are minimized, resulting in a very low overhead. In addition, military personnel experience above average health, enabling us to have lower mortality costs. Last but not least, our strong financial position enables us to underwrite our own life insurance program. These factors allow us to pass these savings to our members through a higher crediting rate.

Will the growth in my insurance be considered taxable income?

No, as long as you do not surrender the insurance. The death benefit is not taxable when received by your beneficiary. They receive the benefit of your policy's growth.

How can I access my cash value?

You can cash surrender your policy at any time without any surrender charge, or you can take a loan at a rate 1% above the current crediting rate. You may, however, create taxable income for yourself if you do.

How can I get more information?

Call a Membership Coordinator today toll-free at 1-877-398-2263, or go online to www.aafmaa.com and look under Life Insurance.

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