Universal Life Insurance Explained
Universal life insurance is a terrific idea for all who would like coverage that is noted by its flexibility throughout its term, which, assuming one pays his or her premiums, can also last permanently. If just now you have started investigating the many available options of good life insurance, then continue on for an overview of coverage and aspects of universal policy provisions and how they are different from other kinds of life insurance.
The 411 on UL Policies
Universal policies are often known as permanent life insurance as there is never a set date of expiration. For as long as premiums are up to date, the policy remains in effect and the policyholder and his or her family are able to receive benefits in the event of the policyholder’s death. What makes this kind of coverage different is that the policyholder is provided a large measure of freedom in regards to their premiums and death benefits. After one’s policy attains a set cash value minimum, the policyholder is given the opportunity to change and update many aspects of the coverage details.
A Savings Vehicle
Before a policy goes into effect, the new policyholder will need to discuss with the insurance provider how the allocation of the premiums will be placed into an investment account. As time goes on, the policy’s monetary value can be placed into an account for the death benefits or it can be borrowed against. These funds can also be put back into the market for investment. At some point, the cash value that is accrued through the earning of interest can also be utilized to pay one’s premiums while keeping the account active without further cash outlay. This is a terrific option for those who are unsure of the state of future finances.
This life insurance policy can be utilized to cover as much or as little as the policyholder chooses. The more entry-level policies will usually cover minor medical and funeral costs. However, one can go much further and expand the policy to include just about anything he or she chooses. This can include such things as mortgage payments for your surviving loved one, the pay back of any debt you left behind, for covering long-term disability help or even tuition for college-bound children. The largest determining factors for the cost of premiums are chiefly one’s age, health and how big the death benefits chosen.