Universal Life Insurance

Trading off cash value for premium payments: Universal life insurance

Universal life insurance is a type of permanent or Whole Life Insurance. You are provided with the same death benefits and cash value options as normal whole life insurance, but unlike normal permanent life insurance policies, universal life insurance does not guarantee the build up of your cash value. Of course because of this, the premium rates are usually cheaper than normal permanent policies.

In essence, you are trading off the cash value for a lower premium. This does not mean that a the cash value build up of a universal life insurance policy will always do worse than a normal whole life policy. A normal policy just offers added guarantee of a steady cash value build up. A universal policy is more than capable of doing just as well, if not better, as a normal whole life policy.

If you are not holding the cash value portion of a permanent life insurance policy as extremely important, universal life insurance may be a better choice for you. You will be receiving the same benefits for a lower premium cost and if your investments do well, you'll have an extra bonus in the form of a cash value build up at the end.

For more information regarding universal life insurance and if it's right for you, try the links we've provided below.

So be sure to check out our pages about Term Life Insurance, Whole Life Insurance, Cheap Life Insurance, Globe Life Insurance, and Variable Life Insurance elsewhere on this site.