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Universal Life Insurance

This is a product that you will need to get all the Facts before making a  buying decision. Ask the Questions

• Minimum Policy and Issue Ages
• Is this a Reverse Load or a Front End Load product (surrender charges)?
• Surrender Charges apply for how many years?
• What is the guaranteed Interest Rate?
• What is the current Interest Rate?
• What is the Rating of your company?
• What are the two options I can choose? (sometimes called option A and B or option 1 and 2). This concerns your Accumulated value and Death Benefit. 
• What are Guide Line Premiums?
• What would cause this contract to become a MEC (modified endowment contract)?
• What are the penalties for early withdrawal of my Cash Value?
• Can I make a Loan on my Cash Value and what is the interest rate?
• Can I decrease my coverage at anytime?
• Can I increase my coverage at anytime and what is the underwriting requirements?
• Can I reduce my premium and how will that effect my coverage?
• Can I increase my premium and how will that effect my coverage?
• If I ever skip premiums what effect will it have on my coverage over the long term?
• What effect will a change in current interest rates have on my coverage over the long term?

Universal life is designed to be a flexible life insurance product..

Cash Accumulation usually has a minimum interest guarantee from the insurance company, while the actual performance of the fund is tied to insurance company investments.

When relying on the insurance company's investment strategies, you should always check the company's financial strength before buying. 

As with any insurance product, it's important you understand how a universal life policy works. It's up to your agent and/or you to figure out if you're getting your money's worth. 

Universal life's flexibility can be misunderstood. That's why it's important to make sure the issued policy is what you were quoted.  There is a Free look period for all Life policies purchased and if the policy is not what you thought or were told ask for a refund.   

Check your policy (have your agent go over the policy contract with you) for its guaranteed rate of return, fees, and charges, and how much minimum premium is required.  If it is not what you bought exercise your Free Look Period. 

You can make withdrawals from your fund under terms that are defined in your policy. Many universal life policies carry reverse load surrender charges that are deducted from the Accumulated Balance in your fund.  Your Accumulated Value will be more than your Cash Value because in the early policy years there will be a surrender charge.  They start out high in the early policy years, then slowly decrease until they disappear — somewhere around the 10th to 20th policy year.

Why Universal.
Universal life can be an alternative to traditional whole life, and in some instances the costs is less. If you have an interest in applying for a  whole life product,  you may want to look into a universal life product. 

There are Universal Life Products that guarantee that even if Current Interest Rates fall to the minimum and the policy performance will not carry it based on the premium you are paying the policy will remain in force until age 90 to 100 as long as you pay the initial premium each month (your premium will not go up). This is a guaranteed Life Benefit based on your original Premium.