Universal Life (UL) insurance is permanent, flexible life insurance coverage. It includes the opportunity to adjust the premium and the death benefit, as well as accumulate cash value on a tax-deferred basis.
A flexible universal life policy is called an Index Universal Life Policy.
Permanent Coverage
As long as premiums are paid on time, you have coverage for the rest of your lifetime.
Tax Advantages
Income tax-free death benefit, potential for tax-deferred cash value accumulation & income tax-free policy loans/ withdrawals.
Accelerated Death Benefits
Early access to a portion of your death benefit in the event of a terminal or chronic illness.
Flexible Premiums and Benefits
Unique option to change the premium payment amount, payment frequency and death benefit amount.
Whole life and universal life are both forms of permanent life insurance, so they are similar in many respects. They both offer a death benefit that lasts throughout your lifetime as well as cash value. However, whole life has a fixed coverage amount and a fixed premium payment that will never increase. Universal life has both more flexibility and more risk.
Many sellers of Universal Life Insurance use “full underwriting,” meaning they take time to examine your application, verify information and require that you do a full life insurance medical exam.
