Bob Shockey borrowed $25,000 from his $250,000 cash value life insurance policy to send his daughter to private college.Assuming he pays interest as in accrues,if Bob dies before the debt is repaid his beneficiary will receive:

Question

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If Bob dies before the loan is repaid, the outstanding loan balance plus any unpaid interest will be deducted from the death benefit. Therefore, the beneficiary will receive the death benefit of $250,000 minus the loan balance of $25,000 and any unpaid interest. The total loan balance plus interest at the time of death would be $25,000 + (interest accrued over time), which would reduce the death benefit to $225,000.

Bob Shockey Borrowed $25,000 from His $250,000 Cash Value Life