| Universal Life Insurance is a type of | | | | hardship, lower the premium amount you pay. |
| insurance policy that not only provides | | | | Realize, however, by doing this, the face |
| protection in the event of the insured's | | | | amount of the policy will change because the |
| death, but it also serves as an investment | | | | difference between the minimum monthly |
| option. It may earn money market interest | | | | premium and the lower amount you pay is taken |
| rates. It's flexible and allows you to | | | | from the policy cash value. Be aware that |
| increase or decrease the amount of insurance | | | | most companies, if not all, include an |
| coverage you need throughout the policy term. | | | | expense charge for each premium payment. |
| Although it is flexible, there are certain | | | | |
| parameters you must follow. The policy limit | | | | • Withdrawals - You may withdraw money |
| may not be decreased beyond a predetermined | | | | from the cash value of the policy. Companies |
| amount, and increasing the coverage may | | | | may have limits as to how many withdrawals |
| subject you to underwriting requirements. | | | | you may take each year and what the minimum |
| Always be aware of your policy's terms and | | | | amount can be. Each withdrawal may be subject |
| conditions. | | | | to fees or charges. |
| | | | |
| How does it work? | | | | Rates: |
| | | | |
| With a Universal Life policy you are in | | | | Rates vary depending on the company. Some |
| control of the amount and how often you pay | | | | companies guarantee that the account value |
| the premiums. | | | | will earn interest at the company's current |
| | | | interest rate. Other companies have come out |
| • You have the option to make lump sum | | | | with policies where rates are guaranteed, |
| payments which will increase the cash and | | | | regardless of the interest rate the insurance |
| death benefit value of your policy. The | | | | company pays. |
| interest on the cash value of the policy | | | | |
| grows tax-deferred. | | | | The best advice is to shop around and always |
| | | | know what's in the fine print. |
| • You may also, at times of financial | | | | |