Features of Universal Life Insurance




  • Once we mentioned in the previous article, universal life (UL) has been around since 1981-82, as a result of a historically high interest environment as well as a consumer understanding of the price of self-directed investments because traditional insurance couldn't tackle short-term rates.
    Here are a few characteristics as follow
    1. Account Value. The account price of a universal life plan is the sum of the gross values of all the investment accounts inside policy, including income, after deductions for that current month expenses.

    image


    2. Cash Surrender Value. The amount of money surrender value of a universal life plan's the present account value, less outstanding loans and surrender charges. Surrender charges are usually in relation to a multiple in the minimum required premium for the policy back-end charges are bigger than front-end charges.
    3. Premiums & Contributions. Premiums are the types amounts required to spend the money for cost of insurance fees along with other expenses for that policy. Deposits are the types excess amounts that are of your pure investment nature.
    4. Death Benefit Options. The quantity of death benefit payable with a universal life policy is predicated upon 1 of four different options
    a)Level death benefit: Level coverage during the entire lifetime of the insurance policy.
    b) Level death benefit plus cumulative gross premiums: Death benefit increases by the amount of each gross deposit on the policy.
    c) Level death benefit, indexed: The amount of death benefit increases, yearly, by the predetermined percentage.
    d) Level death benefit plus account value: The total amount of death benefit is usually equal to the original face amount, in addition to the gross account value. This is the hottest chose by 90% of universal life insurance coverage policies' owners because
    the gross account value is tax free.
    5. Premium Flexibility. The premium deposits, plus accrued investment income, have to be sufficient to purchase all expenses and deductions, to be able to maintain the policy in place, tax exempt life insurance contract, flexible premium.
    Universal our life is not for every consumer. It's flexibility tends to be reflected in better administration costs than are normally found in traditional whole life plans as well as the variable nature of the plan will make it unsuitable for those clients wanting guarantees.
    For additional information about life insurance no exam check this useful web page

Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!