Life Insurances Reviews & Info

A universal life insurance policy works differently than traditional insurance policies. The mechanics of the policy is different. There is more potential for gain in addition to additional risk.

When you put money into your universal life policy some of it goes to toward the cost of the term insurance that is part of the policy. Some of it goes to administrative and other costs. If there is excess money, it will go into an account that earns interest for the policyholder. If there is a deficit and there is enough money in the fund some of that money can be used to pay the term insurance costs.

With a universal life policy the policy owner has a lot of flexibility. He or she can put extra money in to take advantage of the interest that can be earned. The policy owner can also stop paying for the policy for a period of time if the amount is the fund is great enough.

With a traditional whole life insurance policy the cash value build up is guaranteed by the insurance company. If the insurance company does not meet their investment goals, the policyholder still gets the cash value guaranteed by the policy. If the company exceeds their goals, the policyholder gets no additional money unless the policy pays dividends.

The same is true regarding mortality. If the insurance company has to pay more in death benefits than they predicted, they do not change the cash build up in the policies nor will they change the cost of the policy.

With a universal life policy, the policy holder’s policy is affected if the company’s investments do better or worse. The same is true regarding mortality.

There are limits on how much the insurance company can charge for mortality. There are also limits on how low the interest rate can go.

You can request life insurance quotes by completing the form at the top of this page.