Fun Facts On Universal Life Insurance

(Many people underestimate the value and importance of having a life insurance plan.)

There are a variety of life insurance plans available on the market today, so you will surely be able to find one that caters to your specific needs.

There are two main types of life insurance products, with many variations in between these categories. The two main types are term life insurance and permanent life insurance.

Term insurance protects for a specified amount of time, such as 10 or 15 years. And on the other hand, permanent life insurance protects for the entire life time of the person who is insured.

As said before there are various types of life insurance that are found within these two categories, and one type of permanent life insurance is Universal Life Insurance.

An article posted on AOL Money.com, "Life Insurance: Universal Life Insurance," looks into the basic facts on this policy.

Universal life insurance is also sometimes known as adjustable life insurance, just in case you ever come across of the other term.

The important thing to remember with almost all permanent life insurance policy is that some of the money from your premium payment is invested, so this is a great tool for wealth building also.

Instead of just wasting your money every month by paying the monthly premium, some of the money gets saved away and invested, further securing you and your family's financial future.

"The portion of invested premiums accumulates a cash value. This cash value is held in an accumulation fund. You can withdraw the cash value from a universal life insurance policy. You can also claim it as an asset when you apply for a loan. Any withdrawals from the accumulation fund are deducted from the policy's cash value." "While the invested premiums of a universal life insurance policy are generally restricted to safe, low-yielding investments, a variable universal life insurance policy lets you invest a portion of premiums in riskier investments such as stocks and bonds. Variable universal life is a hybrid. It combines features of universal life and variable life insurance."

This makes this a great policy for people looking to invest money in something safe, yet something that they can also have access to at the same time.

Another great aspect of Universal Life Insurance is that the premiums are very flexible, which is always great during this hectic day and age.

"After you pay an initial premium, universal life insurance provides flexibility in paying your premiums. For example, if the portion of invested premiums is growing, you can pay future premiums from this buildup in value."

The other benefit to Universal Life Insurance is the fact that your beneficiary is guaranteed a death benefit should something happen to you. This is not the case with term life insurance.

"Your beneficiary generally does not owe federal income taxes on the death benefit. Death benefits are also free from probate costs and can be protected from creditors in case of bankruptcy. Because of these features, universal life insurance is often used in estate planning."

Consult an LEI Financial Services Life Agent for more information on taking out a Universal Life Insurance Policy.

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