Universal Life Insurance
Universal Life Insurance (UL) combines two basic components—term life insurance and an accumulation fund. Generally speaking, Universal Life insurance allows for flexible premiums, meaning you could skip premiums or pay future premiums in advance, within certain limits. This premium flexibility depends largely on the cash value in the policy. The policy will remain in-force as long as there is enough cash value to cover the monthly deductions for any particular month, but most people don’t fund them to just barely squeak by month-to-month.
Universal life insurance is permanent insurance that provides lifetime protection and cash value accumulation potential. Changes will happen over the course of your life and universal life insurance can offer you the opportunity to change with it. This product’s flexible design allows you to customize the timing and amount of premium payments to meet your needs now and in the future.
Before you purchase a universal life insurance policy, you may want to consider the following:
- The amount and frequency of your premium payments can be adjusted within certain limits.
- Your policy’s account value grows based on a credited interest rate that can change.
- You can access money from the policy via withdrawals and loans. However, this will decrease the cash value and death benefit if the amount borrowed is not repaid.