What is MEC in life insurance?

InsuNews May 23, 2022

What is MEC in life insurance?

A modified endowment contract (MEC) is a cash value life insurance policy that gets stripped of many tax benefits. The seven-pay test determines if the policy qualifies as an MEC. MECs ended a popular way to shelter money from taxes by borrowing from insurance policies whose cash value grew too quickly. Mar 7, 2021

See also  Does military life insurance have a cash value?

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