What is Universal Life Insurance?
A. This form of life insurance provides a death benefit and builds cash value, which accumulates at a current non-guaranteed interest rate. This cash value earns tax-deferred interest until the time it is withdrawn. There are various optional riders that can be added. Contracts vary between insurers. For more information, please contact our customer service area.
Universal life insurance is a flexible premium policy under which the policy owner may adjust the death benefit from time to time and vary the amount or timing of premium payments given specified limitations. Premiums are credited to a policy account from which mortality charges are deducted and to which interest is credited based on short term interest rates. This crediting usually allows some cash value build up in the policy.
Universal life is a flexible premium life insurance policy under which the policyholder may change the death benefit from time to time (with satisfactory evidence of insurability for increases) and vary the amount or timing of premium payments. Premium (less expense charges) are credited to a policy account from which mortality charges are deducted and to which interest is credited at a rate which may change from time to time.
This is adjustable life insurance that allows flexible premium payments,* pays the life insurance benefit if the insured dies before the maturity date, and pays the cash value if the insured is living at the maturity date. A flexible premium is one that may be paid at a scheduled or unscheduled time. When a premium is paid, an expense charge is immediately deducted and the balance is placed in a cash value fund to earn interest at the current rate. Each month, all insurance expense charges necessary to keep the policy in force are paid internally from the cash value, regardless of whether or not the premium was paid. The cost of insurance will increase each year on the policy anniversary based on the attained age of the insured. This is a non-participating policy on which no dividends are payable. * The policy will terminate at any time if the cash surrender value is insufficient to pay the monthly deductions. This can happen due to insufficient premium payments, if loans or withdrawal
