Universal Life

Why You Should Consider Universal Life Coverage for a Lifetime Protection

Permanent life insurance provides a lifetime protection to the policyholders. Most people cannot handle the higher rates in the whole life insurance while others have a fear of outliving the term coverage. Therefore, universal life insurance (UL) is the best and most affordable coverage for anyone looking for permanent protection. UL is a flexible premium adjustable life policy that allows the policyholders to adjust their rates every month and features a savings element that grows on a tax-deferred basis.

Coverage options

Insurance companies provide different types of insurance policies. Some of the common ones include:

Variable UL policy- the insurance coverage allows investment of a portion of your cash value.

Index UL insurance- the policy provides an account that provides an opportunity to earn some income based on one’s index in addition to the flexible insurance premiums.

Group universal life coverage- this is the insurance policy provided by the employer.

UL Insurance Benefits

The policy is the best coverage for anyone seeking great lifelong protection or saving for long-term purposes. Business owners looking for a tax-efficient way to protect their business value may opt for this insurance policy. The insurer terms the withdrawals from the account value as loans that may accrue interests and reduce the death benefit as well as cash value. Some of the benefits of UL include:

Ability to adjust the death benefit- policyholders may opt to reduce their death benefits, which contributes to the low cost of the policy. On the other hand, they can also add the benefits to increase the compensations made to your loved ones upon your demise.

Accumulation of interest on your cash value- UL policy has a cash value that earns interest depending on the current market rates. The interest rate may go down depending on the market, but companies may offer protection against this by giving a minimum performance guarantee on the coverage.

Flexibility on payment of premiums- policyholders can lower their premium rates or stop payment if they already have an accumulated amount of the cash value.

Tax-advantaged- the accumulated cash value in your account is tax-free, meaning that one can save a lot in a short time.