what is universal life insurance? We have it and the policy goes up every five years.?

Public Comments

1. It's just a flavor of whole life insurance. Too many people knew whole life was a scam, so they made slight changes to it, and sold it as if it wasn't a scam.
2. Universal Life Insurance is adjustable life insurance under which: 1) Premiums are flexible, not fixed; 2) Protection is flexible, not fixed; and 3) Insurance Company expenses and other charges are specifically disclosed to the purchaser of the policy. If you want a form of life insurance that does not increase every five years, you may want to consider Level Term Life Insurance. With Level Term Life Insurance you can get life insurance protection for up to 30 years, where the annual premium and the coverage amount remain the same for the entire term of the policy. I hope that helps! Best of luck to you.
3. Universal life insurance is an increasing term insurance to age 100 plus a savings plan in it. When you pay your first month premium, the insurance company doesn't send you a bill anymore. They send you a statement advising you what you need to pay. In the statement, you are given two different premium payments. You may pay the minimum premium, which closely resembles to what you pay for a term insurance and a target premium, which resembles to what you pay for a whole life policy. As the cost of insurance goes up, less and less of the premiums goes toward the cash value. Soon, all the premiums you pay goes toward insurance, and none toward cash value. As premiums continue to go up, you might not be able to afford it anymore. So you pay whatever you can afford and the cash value will be used to make up the difference. Eventually, the universal life policy will self-destruct, meaning premiums are so high and the cash value is depleted. These are worst of the worst of all life insurance policies. If you want to protect your family's income in case you die, you should get a 20-30 year term insurance with the right amount of protection. If you want to build savings for retirement, then you should open an Individual Retirement Account and invest in mutual funds and/or bonds. That way you are renting wealth and building wealth at the same time.