Universal Life Insurance Explained - Why Would You Want Universal Life Assurance?
Perhaps you've never heard of universal life assurance? It's well worth considering, so let's have a look at what it is and how it works.
Universal life insurance explained You'll be treated to flexibility with a universal life insurance that you will not get from any other type of policy.
It's similar to whole life insurance in that it carries a cash value account, but a whole life policy is much more rigid.
It is suggested that only those who want to be insured into their 70s or later should consider universal insurance, but anything can happen at any time and it can be useful.
Consider the following: Flexibility: Compared to whole life insurance, universal insurance is incredibly flexible.
You choose your own coverage amount and you have the ability to adjust this amount as the need arises.
Savings: Does tax-deferred sound great to you? Universal insurance carries a tax-deferred savings account that earns interest at a set rate that is credited every month, rather than per annum.
Options: You have many options with a universal policy.
You can add term life riders for your spouse and your children or other dependents, waive monthly premiums if you become disabled, and you are treated to guaranteed insurability.
Loans/Withdrawals: A universal insurance policy allows you the option of withdrawing from the cash value account or you can take a loan out against it.
You should be aware that any money taken out as a loan against this account will be deducted from any death benefits if it remains unpaid at that time.
Each company has different amounts and frequencies that you can take out loans and withdrawals and your agent will be able to provide you with the details.
Charges: If you make withdrawals or surrender the cash value of your universal insurance, you may be charged.
It should be known that if you surrender the value, you will receive the full amount contained in the account after any charges and unpaid loans are deducted from the total.
Death Benefits: Unlike a lot of other insurance policies, a universal insurance policy carries tax-free death benefits which is quite a bonus when you take into account the deceased's final tax return and estate taxes.
You can usually choose the option of whether or not your beneficiary gets the life insurance payout, the cash value account only, or both.
Universal life insurance explained You'll be treated to flexibility with a universal life insurance that you will not get from any other type of policy.
It's similar to whole life insurance in that it carries a cash value account, but a whole life policy is much more rigid.
It is suggested that only those who want to be insured into their 70s or later should consider universal insurance, but anything can happen at any time and it can be useful.
Consider the following: Flexibility: Compared to whole life insurance, universal insurance is incredibly flexible.
You choose your own coverage amount and you have the ability to adjust this amount as the need arises.
Savings: Does tax-deferred sound great to you? Universal insurance carries a tax-deferred savings account that earns interest at a set rate that is credited every month, rather than per annum.
Options: You have many options with a universal policy.
You can add term life riders for your spouse and your children or other dependents, waive monthly premiums if you become disabled, and you are treated to guaranteed insurability.
Loans/Withdrawals: A universal insurance policy allows you the option of withdrawing from the cash value account or you can take a loan out against it.
You should be aware that any money taken out as a loan against this account will be deducted from any death benefits if it remains unpaid at that time.
Each company has different amounts and frequencies that you can take out loans and withdrawals and your agent will be able to provide you with the details.
Charges: If you make withdrawals or surrender the cash value of your universal insurance, you may be charged.
It should be known that if you surrender the value, you will receive the full amount contained in the account after any charges and unpaid loans are deducted from the total.
Death Benefits: Unlike a lot of other insurance policies, a universal insurance policy carries tax-free death benefits which is quite a bonus when you take into account the deceased's final tax return and estate taxes.
You can usually choose the option of whether or not your beneficiary gets the life insurance payout, the cash value account only, or both.
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