A universal life (UL) insurance policy is more flexible than other permanent policies, so you can customize it to fit your lifestyle.
Universal life insurance:
- May provide a guaranteed death benefit, ensuring the financial security of your family.
- Gives you the flexibility of choosing how much, and when, to make premium payments. (Depends upon the cash value in your policy.)
- Accumulates tax deferred and is accessible on a tax-preferred basis and is generally income tax free (under current tax law) to your beneficiary upon your death.
- Lets you access the cash value for any purpose you may choose including a down payment on a home, a tuition payment for your child or to provide cash flow during your retirement.*
- Allows you to change your death benefit which means you can increase or decrease your death benefit amount (increases are subject to underwriting) as your needs change.
- Guarantees the interest rate that you earn on your cash value to be at least 2.5 percent annually, although our credited rate, which is not guaranteed, has been much higher.
Premiums can be level for lifetime. You can select the age they want the death benefit guaranteed to.
The length of premium payments can be structured according to your preferences.
Interest rate volatility does not affect premium payments.
This product is inexpensive as a permanent life insurance product compared to other products, as the premium is calculated to maintain a level premium payment until death.
Comparisons of this product among insurance carriers are relatively easy as there are not many components to the plan.
This product may not have any cash value, unlike alternative permanent life insurance products.
Although premiums may be lower than whole life insurance or other permanent insurance products, they will generally be higher than term insurance.
The greatest con of guaranteed universal life is that the timeliness of premium payments is critical to maintain the guaranteed level premium. Other policies that contain cash value can provide a source within the policy to cover the required premium to maintain the death benefit, however, a missed or late premium payment can jeopardize the guaranteed premium feature resulting in a policy without a guaranteed premium.
The contemporary life insurance market is way more extensive than a source of income for beneficiaries when catastrophe strikes. With a plethora of options, these plans offer you and your entire family peace of mind, and often give your money investment opportunity to allow you to enjoy the money invested during your lifetime.
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