A life policy loan in West Virginia cannot charge a fixed rate of interest higher than?

In West Virginia, the laws governing life insurance policies specify that loans taken out against the cash value of a life insurance policy cannot charge a fixed rate of interest higher than 8%. This regulation is in place to protect policyholders from excessive interest charges that could make it difficult for them to repay the loan.

A loan against a life insurance policy is generally a relatively straightforward way for policyholders to access cash, but the terms of the loan, including the interest rate, must be clearly defined and regulated to ensure fairness. Therefore, capping the interest rate at 8% provides a balance between allowing the insurer to earn a reasonable return on the loan while ensuring that policyholders are not burdened with unmanageable debt levels.

Understanding this limit is crucial for individuals considering taking out a loan against their policy, as it directly affects their financial obligations and planning.