An Essential Guide To Universal Life Insurance
Readers Question:
What are the benefits of a Universal Life insurance policy? Will I have to spend much on such a plan?
Shirley
Des Moines, IA
Good question. Let’s define Universal Life insurance first: this is a special kind of Whole life or Permanent life insurance coverage that allows a policyholder more flexibility when it comes to adjusting how much you pay for premiums, and even your death benefits. It has the savings or cash value feature of a whole life insurance policy as well. The benefits of such a life insurance plan include:
1. More options when it comes to pay-outs after the maturity of the policy – you may choose to have either the cash value as the death benefit, making premiums lower, or the face value amount of the policy.
2. A Guaranteed minimum interest rate stipulated on the policy – your cash value is sure to grow at a set rate, regardless of the insurer’s financial performance.
3. Tax-deferred accumulation of wealth – There are only certain instances where state and federal taxes can apply.
4. Your money is placed in a diversified range of investments – reducing the risk of loss in case a particular investment goes south.
Similar to any type of permanent life insurance policy, when you buy universal life insurance coverage your initial premiums can be very expensive, this is because you’re building up your cash value, and like most permanent life insurance plans, premiums become cheaper in the long run.
However, it is still highly recommended that you shop around for the most competitive policies before you even decide to buy life insurance coverage. The Internet is a great place to start; with many life insurance portals and websites giving access to the latest rates and offers, making it possible to effectively identify the providers that is most affordable to you.
Do maintain a healthy lifestyle and seriously consider quitting smoking. Smoking alone and push rate up by as much as three to four times above the average. Hazardous activities or hobbies also tend to make life cover more costly; so if you intend to keep premiums affordable, then reduce your risk of dying sooner.
How to Get Cheaper Universal Life Insurance
Reader’s Question:
I currently own a 2-year old life insurance policy but I’m not satisfied with the premiums I’m paying. Can I do something to get cheaper life insurance rates?
Baron
Lafayette, IN
Yes, the good news is that there are still some effective ways to get savings on your life insurance coverage. Here are a few tips that could prove quite useful to you:
1. Make Sure You Have the Right Policy
Paying for the wrong kind of policy is an utter waste of money, but you’ll be surprised at how often this happens. If you just need coverage for a certain period of time, such as while raising a family or paying your mortgage, then go with a term life insurance plan. Want to accumulate substantial amount of money and have permanent coverage? Then a whole life insurance plan is recommended.
2. Take Advantage of “Price Breaks”
With most life insurers today, choosing a higher coverage amount (a.k.a. death benefit or face value) can actually give you lower rates. So if choosing between a $350,000 policy and a $450,000, going with the latter can actually save you money.
3. Live a Healthier Lifestyle
Taking care of your health and quitting smoking can do real wonders in keeping your rates affordable. There is no better time to start this than now.
4. Go with Annual Payment Plans
If your life insurer offers this, consider paying your coverage a year in advance. This entitles you to get discounts or lowered premiums.
5. Look for Discounts
Discounts abound, and you want to make sure to ask your insurer about those you might be eligible for. This is an almost effortless to get savings out of your life insurance bills.
6. It Wouldn’t Hurt to Shop Around
There are hundreds of life insurance companies out there and it would be a good idea to run a free quote check from insurance comparison portals (like this website) to know what is being offered. There are times when the only way to get cheaper life insurance is to switch carriers.
Cheap Smoker Universal Life Insurance
Reader’s Question:
Exams are a pain so I tend to smoke to keep bring down the tension afterwards. It’s the only time I smoke, I swear! Will this boost up the premiums if I get a universal life insurance policy in Stamford?
Zachary
Stamford, CT
Oh, Zachary, lots of people say the same thing about their smoking habits. A lot of my friends say that they smoke only when they drink beer or only after eating or only when they’re incredibly stressed out at work – but the one stick a day quickly develops into a one pack a day habit. It is a habit that various research have closely linked to lung diseases, particularly cancer; hence, it is a widely recognized health risk to be a smoker.
Nevertheless, I guess most life insurance companies in Connecticut do recognize the need to provide life insurance coverage to smokers as well as non-smokers. However, considering the proven health risks, it does tend to boost up premiums compared to non-smoker levels, particularly for whole life insurance policies. Since you’re considering universal life insurance, however, the variability of both premiums and returns from this type of life insurance may help shield you from the usually high premiums. You might want to look into equity-indexed universal life insurance and compare the terms and conditions with traditional fixed universal life insurance.
An efficient way to do this is to request for free online quotes from this site (just enter your zip code). You can then compare smoker life insurance coverage available to determine which one offers the best value for you. Just remember to be frank about you smoking habits so you get accurate quotes. Best of luck, Zachary.
Cheap Universal Life Insurance Rates
Reader’s Question:
I just got a new job and my mom’s been bugging me to get universal life insurance. Can you tell me, what is the difference between universal life insurance and whole life insurance, anyway? Is it the same as variable life insurance here in Bloomington?
Vanessa
Bloomington, IN
You have a very practical mom, Vanessa. Nevertheless, I think it’s good that you’re exploring all your options and not just looking at universal life insurance per se.
Now, to answer your questions. Whole life insurance and universal life insurance both provide permanent insurance coverage; however, whole life insurance involves a level premium which guarantees you a certain death benefit amount as well as cash values while universal life insurance policies involve more flexible premiums as well as potential for higher benefits. There are three basic types of universal life insurance – the interest-sensitive traditional fixed universal life insurance, the equity-indexed life insurance and the fully flexible variable universal life insurance.
Most universal life insurance companies in Indiana would probably be able to offer you both types of life insurance as well as any of the three types of universal life insurance. You must be careful, though, because different insurers would have different policy costs, terms and conditions. It is advisable that you shop around for a bit before you commit or sign a contract. I suggest that you request for free universal life insurance quotes online from insurers in Indiana. To do this, type in your zip code in the forms on this page. Compare and contrast so that you can get the best deal. I hope I was able to help clear up things a bit for you, Vanessa.
Universal Life Insurance Quotes Online
Reader’s Question:
I’ve heard of universal life insurance but am not sure what it is. It was just mentioned to me in passing the other night. I was intrigued since I only knew whole life insurance. What is universal life insurance and is it available in Fresno California ?
Landon
Fresno, CA
I am so glad Landon, that your interest was tickled enough for you to ask me this question. Who knows Landon, it may turn out to be one of the best information you’ll appreciate over time.
Universal life insurance is quite new, so you are correct in saying that there was only whole life insurance before. But universal life insurance still follow the same guiding principles of life insurance. You still get to deposit a certain amount of money, and your named beneficiary will get the death benefits after your demise.
Another similarity that universal life insurance has to whole life insurance is that it generates tax-deferred cash value but at the same time, this is where they have their distinction. Cash value and dividends made from universal life insurance are unpredictable but can be pleasantly so. Universal life cash value and dividends vary over time, and can be very high or low, depending on the performance of the stock the funds are invested on.
If you feel this is your cup of tea and if it appeals to your sense of adventure, than by all means start searching for your universal life insurance by entering your zip code on the space provided at the top of this page.
After answering the questions, you will get free quotes from universal life insurance companies and you can start evaluating them. I would also recommend visiting some insurance offices just so you can ask all the questions that you may have on your mind.
Cheap Whole Life Insurance Rates
Reader’s Question:
How can I buy cheapest whole life insurance premium here in Cincinnati? Are there companies that offer cheap whole life insurance?
Daniel
Cincinnati, OH
Hello Daniel
Actually, whole life insurance premiums are substantially high compared to the term life insurance. Perhaps, you’ve already heard that term life insurance is the cheapest life insurance there is. However, it does not give you the benefits that you can get from whole life insurance – that is, you get an investment side and you have the chance to utilize the money while you’re still alive. But if you are plainly asking the possibility of cheapest whole life insurance (which I believe is what your question mean), I would say there is indeed cheapest whole life insurance in Cincinnati.
First, you may want to consider universal life insurance which is a whole life insurance version but with the flexibility of payment. The flexibility is based on the interest rate of the present investment. To give you idea of your initial and possible life insurance premium to pay, you can get free quotes on this site.
If, however, you really want whole life insurance only, then you can do well by searching for life insurance companies that offers the cheapest whole life insurance premium. Anyway, the life insurance premiums differ from one company to another, so surely among many companies, you can find the one that offers the cheapest whole life insurance premium.
Instant Universal Life Insurance Quotes Online
Reader’s Question:
The internet is a very good tool for people like me who wants to search for so many topics. Lately, I came across whole life insurance and universal insurance in Pennsylvania. I have a hard time understanding the two products; please I need your good help.
Carry
Scranton, PA
It is a little bit confusing actually, if you’re not familiar with it.
Both whole life and universal life insurances in Scranton will be able to provide certainty on our death benefits. Also they are usually being paid monthly and these two insurances are both overages of permanent life insurance
For the permanent life product line the very basic among all is the whole life insurance. You are paying monthly premiums for this and part of those monthly premiums is being shell out to accumulate and become cash value which is tax free. The money that you are paying is being invested by the insurance company to other sectors and they will guarantee you with dividends. But there is a cons to this, the dividend is constant it will vary according to the economic situation. It also allows the policy holder to loan against the cash value. What’s good with this is that the premiums are constant all through out.
On the other hand the universal life insurance, mix up the term life insurance with the money market investment. This type of insurance does not give you any guarantee on the return of investment and more often the incentive goes down more often than the whole life insurance.
Carry, if you are planning to get one of these insurance products be very specific about your queries to your insurance agent . Ask about your worries and doubts, also about your expectations to the product that you are going top choose. You can also opt to do a little shopping for free life insurance quotes online using so many insurance websites like this one. Use any similar form like the one you see in this page for you to get routed to free quotes which you can compare in your area.
Life Insurance Quotes Online
Reader’s Question:
I have heard of the new life insurance product called the universal life insurance. What are the special features of universal life? Would it be available in Nebraska ?
Judith
Omaha, NE
Certainly, Judith, your insurer in Omaha will carry the universal life as part of the life insurance product line. Thank you for the question as it will give me an opportunity to explain the special features of the universal life insurance.
The closest life insurance to universal is whole life insurance. Both offer permanent protection, as well as tax-free cash values and competitive interest rates. Their biggest contrast is the payment of premium and in the calculation of death benefit. Whole life insurance is the more conventional kind of insurance where the owner pays a fixed monthly rate for a fixed death benefit package. Universal life is at the opposite end of the pole, in this case. Universal life lets the owner choose the amount and frequency of payments, just as long as the annual premium is completed. Consequently, coverage and death benefits can vary depending on your needs and cash value. You can also expand your coverage by paying a higher premium. Also, universal life can have several rider policies, dependent on your wishes. Ask your insurance company in Nebraska on the available riders that can be included in your universal life policy.
You can also try several combination’s or packages and get free quotes for them by entering your zip code on the space you find on this page. Universal life insurance will appeal to more daring investors, I guess. It has high risk components but with equally high yielding investments. Also, if you have an irregular income, universal life will be the ideal life insurance for you.
Free Universal Life Insurance Rate Quotes
Reader’s Question:
How can I use life insurance as future investment in Las Vegas? I really though life insurance is just for beneficiaries who are left if I die.
Marco
Las Vegas, NV
It’s true that insurance are provided to your beneficiaries when you die, but it can do more if you buy permanent life insurance. There is one type of life insurance that only the beneficiaries can benefit, which is the term life insurance. Term life insurance is purely life coverage for most life insurers in Nevada. Your life insurance should be enforced within a specific term so that when you die, your beneficiaries will receive something. But without death on the term of your life insurance, you will most probably gain nothing.
Another type of life insurance which has an investment side is known as permanent life insurance. This is definitely available in Las Vegas because this is common. It can accumulate cash every time you pay your basic premiums. Even if you decide to eventually stop paying premium at certain time, the cash will continue to accumulate. The premiums will differ in terms of the cash value that it could produce plus the death benefit it offers. Permanent life insurance will have three variations: universal life insurance, whole life insurance, and variable life insurance. Each will vary on how the cash accumulates normally due to the interest rate variable.
Permanent whole life insurance will be very useful in your future because of its cash value. You can withdraw it and use it for whatever purposes. Some would buy whole life insurance for their retirement. Others would buy the same type as a valuable emergency fund. Some would use it to meet monthly mortgages or any other long term financial obligations. Life insurance is really investment for your future. All you need to do is to choose the appropriate type in Las Vegas Nevada NV and you will be all set.
Life Insurance in New Jersey
Reader’s Question:
Hello, I’m from Irvington, New Jersey. Please explain, why is it that term life insurance policy is cheaper than whole life insurance policy?
Nicole
Irvington, NJ
Hello there Nicole.
This is the common question for most people who are looking for their money’s value.
Bear in mind that “cheapest doesn’t always equivalent to the best option”. Term life insurance policy is cheaper compared to whole life insurance policy simply because term life insurance covers you for a limited period of time only. The coverage end up when the specified number of years is completed.
Compared to whole life insurance, term life insurance does not build up cash value. If you are going to surrender or terminate the life insurance policy you cannot get your money back. While a whole life insurance has a cash value, its insurance and at the same time also an investment that could give you cash equivalent in the long run.
These are the direct comparison between term life insurance and a whole life insurance. It is also the main reason why term life insurance is cheaper than whole life insurance.
To avail free quotes, you can go to websites that offer free quotes such as this one. It is as simple as filling out a form, and you will be given free quotes without any obligation. I suggest you do compare at least 5 rates from different companies before you buy any insurance from your area.
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