Universal Life

Universal life is a relatively new kind of permanent life insurance policy. To find and buy universal life insurance, applicants should first understand how universal insurance works. Like whole life, universal life represents a contract between the insured and the insurance company. In exchange for paying the premium, the insured is guaranteed that the beneficiary will receive a payment upon his or her death. The policy remains in force for the life of the insured, provided the premiums are paid according to the structure of the contract.

Provided a Universal Life is properly funded it can be a good option because of its flexibility.  The insured can vary his or her premium payments according to circumstances.  Provided there is enough cash value, the insured can skip payments if need be without losing the insurance.  The insured can also put more money into the contract if they choose.  The Death Benefit is also flexible.  The face amount can be reduced or as long as the insured’s health is good they can also increase the face amount without having to buy a new policy, unlike other life insurance contracts.  A Universal Life policy also provides a guaranteed interest rate and a current interest rate that is competitive.

Because it is so flexible, the insured must make sure that he or she is putting enough money into the policy to keep it going; otherwise it can lose its benefit in later years.  Newer Universal Life policies have addressed this issue by providing guaranteed contracts.  As long as the insured pays a specified amount without missing payments the company will guarantee the death benefit even if the cash value goes to zero.

Universal Life is a good option for the consumer who wants permanent insurance at a lower premium than whole life.  It is also good for those who would like the advantage of competitive interest rates and cash accumulation while at the same time being insured all in one contract.

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For more information contact Ted Ratliff at SeniorCare Financial Services 877-546-7441 or email us at ted@seniorcarefinancialservices.com