Should I Buy Universal Life Insurance
There may not always be a simple yes or no answer to that question. Even in cases of yes there is the question, 'how much universal life insurance coverage should I buy'. There is a simple checklist that can be followed to determine if universal life insurance is a good fit for your situation. There are also a number of ways to determine how much insurance you should purchase as well. These and other related topics are addressed in the text below.
Suitability
The first aspect that many point out regarding universal life insurance is that the policies have flexible premiums. This is something that may appeal to some customers. There is a direct correlation between the premium and the benefit though; the higher the premium, the greater the benefit that is paid; the lower the premium, the lower the benefit that is paid. This feature does allow the policy holder to change things to meet their budget or their need though. For example, if someone becomes pregnant there may be reason to increase coverage for the duration of the child's childhood. There is also term life insurance that may supply that additional coverage with different rules and costs.
There is a savings element as well. This element is part of what increases the cost. It is however what ensures that there is cash value that assures the policy holder a guaranteed death benefit. Savings or cash value is something that most term policies do not offer, for example. This may be a motivator for some to select increasing the premium during times when there is greater need. It is an important consideration to estimate how much return could be earned on the savings realized by selecting a term policy over additional coverage in a universal life insurance policy for the specified time.
The final consideration is a distinction between whole life and variable life. With variable life the individual is able to use the interest earned to help pay for the premium. It is important to review the particulars of the specific policies being compared though. Not all policies will have the same rules.
How Much Coverage Do You Need
This is a topic that many dread facing. There are some basic considerations that nearly anyone should address though. The first of these is the cost of the funeral. This is something that can be determined when the funeral is being planned. When developing your cost estimate be certain to consider factors such as inflation, unless the cost is a fixed amount. Beyond that, other considerations–such as debt and remaining costs of caring for dependents–are included. This term’s dependents include any individual that is dependent on the individual the policy is written for. Some examples include children and disabled individuals.
The consideration of caring for individuals need not be the limit of the benefit though. In some cases the policy may be intended to make a benefactor financially independent. This would likely increase the amount of the desired benefit, which may increase the premium. In some cases this intention may be addressed later in life to reduce the cost of the insurance. Adequately planning to ensure there is sufficient time to accomplish cash value is essential as well though.
For more information from Steven on how to buy life insurance and annuities, visit our Annuities site. Or if your looking for life insurance quotes you can visit our insurance site! Feel free to check out our Insurance blog too!
Suitability
The first aspect that many point out regarding universal life insurance is that the policies have flexible premiums. This is something that may appeal to some customers. There is a direct correlation between the premium and the benefit though; the higher the premium, the greater the benefit that is paid; the lower the premium, the lower the benefit that is paid. This feature does allow the policy holder to change things to meet their budget or their need though. For example, if someone becomes pregnant there may be reason to increase coverage for the duration of the child's childhood. There is also term life insurance that may supply that additional coverage with different rules and costs.
There is a savings element as well. This element is part of what increases the cost. It is however what ensures that there is cash value that assures the policy holder a guaranteed death benefit. Savings or cash value is something that most term policies do not offer, for example. This may be a motivator for some to select increasing the premium during times when there is greater need. It is an important consideration to estimate how much return could be earned on the savings realized by selecting a term policy over additional coverage in a universal life insurance policy for the specified time.
The final consideration is a distinction between whole life and variable life. With variable life the individual is able to use the interest earned to help pay for the premium. It is important to review the particulars of the specific policies being compared though. Not all policies will have the same rules.
How Much Coverage Do You Need
This is a topic that many dread facing. There are some basic considerations that nearly anyone should address though. The first of these is the cost of the funeral. This is something that can be determined when the funeral is being planned. When developing your cost estimate be certain to consider factors such as inflation, unless the cost is a fixed amount. Beyond that, other considerations–such as debt and remaining costs of caring for dependents–are included. This term’s dependents include any individual that is dependent on the individual the policy is written for. Some examples include children and disabled individuals.
The consideration of caring for individuals need not be the limit of the benefit though. In some cases the policy may be intended to make a benefactor financially independent. This would likely increase the amount of the desired benefit, which may increase the premium. In some cases this intention may be addressed later in life to reduce the cost of the insurance. Adequately planning to ensure there is sufficient time to accomplish cash value is essential as well though.
For more information from Steven on how to buy life insurance and annuities, visit our Annuities site. Or if your looking for life insurance quotes you can visit our insurance site! Feel free to check out our Insurance blog too!