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????Whether it is a Direct Recognition or a Variable loan interest rate, Insurance companies are not in the business of giving below market rate loans.
Mighten they do so if Market Interest rates would happen to increase above the policy loan rates they are contractually obligated to honor for a given policy holder?
I am not a finance person, I have minimal knowledge of what has happened with interest rates up and down, but... I have a whole life policy which I have held for 50 years. The contractually stated interest rate is 6% and I have taken policy loans at that rate. I have no idea what the rates were elsewhere when I had the loans, but I have to believe that over a 50 year period there may have been market rates both above and below 6%.