One reason to have Universal Life Insurance is because it can be a low cost way of having lifetime coverage. Some UL policies are designed with very low cash value, so that your premium goes to keeping the policy in effect for a long time, vs building up cash value. If you plan to never borrow from your policy, using Universal Life for permanent coverage can be a cost effective choice.
Another good use for Universal Life Insurance is retirement income. Using Indexed Universal Life, you can over fund your policy and then borrow from it during your retirement years. Because IUL takes advantage of modest market gains, but protects you from losing more than you started with, Indexed Universal Life can be a favorable retirement financial product.
Finally, UL has the advantage of being adjustable. In essence, one policy could be adjusted to meet the differing needs over one policy holder's lifetime. This is a big plus over Term life insurance, that is very rigid.
President, Lane Independent Agency, Southern California
Because, under the right circumstances and with the right carrier, you can outperform whole life's growth by buying universal life. Universal is tied to certain market activity, which can permit additional growth over the carriers general fund. However, in down markets, it permits loss, which can actually cause an increase in the premium. There is, however, an easy way to prevent any such loss. Buy Indexed universal life. It provides a slight decrease in the market's appreciation in exchange for a guarantee that you will never lose money when the market drops. Your funds are locked in annually. Talk with your agent. Thank you. GARY LANE.
Regional Marketing Director, Capital Choice Financial Group,
Never purchase Universal Life insurance! Only buy term insurance because it will cover you when you need it the most, in the early years. This is where your kids are at home, debt is the highest, you have a mortgage, and where loss of income will be devastating. The cost of term insurance is about $2 per $1,000 while UL cost about $16 per $1,000. You do the math! The purchase of a term policy will give you the ability to be covered adequately while investing outside the policy for retirement or paying down debt. The bottom line is that you don't need life insurance you whole life!
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Another good use for Universal Life Insurance is retirement income. Using Indexed Universal Life, you can over fund your policy and then borrow from it during your retirement years. Because IUL takes advantage of modest market gains, but protects you from losing more than you started with, Indexed Universal Life can be a favorable retirement financial product.
Finally, UL has the advantage of being adjustable. In essence, one policy could be adjusted to meet the differing needs over one policy holder's lifetime. This is a big plus over Term life insurance, that is very rigid.