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How Does Universal Life Insurance Work Pros and Cons Universal Life Insurance Company- Reviews


Universal life insurance pros and cons, how does universal life insurance work. Universal life insurance company http://www.financialinsuranceadvice.com/
Universal Life Insurance is a type of flexible permanent life insurance that can give you the high face value of a Term policy with a premium much lower than you would get in a whole life policy, depending on your age. (For a person in his/her 20s, a whole life can actually be cheaper than a universal, depending on how it is structured.) The reason many people never purchase universal life is that when they ask their agent, “what is universal life insurance,” they are often given a universal life insurance guide that has been approved (in all its complex language) by the State’s Department of Insurance but that does little to help a person truly understand the advantages. Unfortunately, many agents who have been trained to sell only Term Life or Whole life do not understand themselves just how to explain Universal Life insurance.
Universal Life insurance is a form of “permanent” insurance, but is not considered “whole” life. It is more correctly termed “flexible premium adjustable life.” Simply put, you pay your premium into a special savings account called the “accumulation” fund. Into that fund, the company adds interest. Out of that fund the company takes the cost of insurance and applicable fees. Once you have cash built up in the fund, there is no particular premium that you absolutely have to pay as the costs will come out of the accumulation fund. Once the fund is close to being depleted—in other words, there is not enough money left to pay the fees for the following month—the company will notify you that you need to begin paying premiums or the policy will lapse. Again most polices are safe for 2015 and beyond but never guaranteed unless stated in the policy!
Universal life insurance pros and cons
How does universal life work
Universal life insurance company

You decide what you want for a Universal life Policy
1. You decide (up to limits regulated by federal tax law) when and how much premium payment to “pour in.” The minimum premium is based on insurance company expenses, premium taxes, and the cost of pure insurance for your policy.
2. As you pay your premium, the insurance company deducts its sales expenses and premium taxes.
3. The remainder of your premium is credited to your cash value account. Each month, the company charges this account for its other expenses and the cost of pure insurance (net amount of risk coverage), or mortality cost.
4. Your cash value earns interest at a rate that fluctuates based on the rates earned by a segregated portfolio within the insurance company’s general account. A minimum (guaranteed) interest rate will be stated in your policy.
5. If the company’s portfolio earns more than the guaranteed interest rate, the company credits the excess interest to your policy.
6. If your remaining cash value is not sufficient to cover expenses and the cost of pure insurance, and you do not pour in more premium, the policy amount may then have to be reduced, or your policy will lapse. This would be similar to crushing the container at the top.
7. You may take a policy loan in an amount not to exceed the policy’s cash surrender value less the annual loan interest. Repayment replenishes your cash value; any loan balance outstanding (plus interest due) at your death is deducted from the policy amount paid to your beneficiary.

Once you figure out what you want out of a universal life insurance contract both pros and cons
Then you need to contact us to figure out the best scenario for your life and investments,
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Universal life insurance pros and cons
How does universal life insurance work
Universal life insurance company

The Logic Of Disability Insurance

It is difficult to imagine yourself as having an illness or having suffered an injury to the point to where you are unable to work and earn an income. We are all conditioned to believe that everything will always continue just as it did before with no change. This mentality can lead to the financial downfall of many people, because then they are not prepared for emergencies, or situations that hit them out of the blue.

People don’t realize that the incidence of disability to the extent just mentioned, is five times greater that the incidence of people having a fire in their home. One reason for that is because a fire is so much more visible and dramatic than a neighbor becoming disabled, and we really don’t think too much about these kinds of things – until they happen to us.

What we are really talking about here, when we talk about high income disability insurance, is the protection of a stream of income that will cease, if a disability lasts long enough, usually about a month to three months. How long could you last with no income? When would the auto dealer come and repossess your car? How long would the mortgage company wait for you to pay your house payment, before they foreclosed on your house?

This is the real issue, and it is a real risk. Most people who have their health insurance through their employer also have disability insurance coverage through their group health plan. However, with the advent of Obamacare, many employers are dropping coverage and pushing their employees toward the exchange that will be handling the government insurance. This, of course eliminates the person’s disability coverage, so in order to purchase it, he or she will have to buy directly from an insurance company.