What are the pros/cons of Universal Variable Life Insurance?

Who are the good providers. What kind of questions to ask and know about hidden costs/risks/returns. Thanks for your time in advance. sansoo

Public Comments

1. Variable life got popular with the advent of high interest rates, but like all fads, it ain't as good as it used to be. I was offered a Variable life as the next greatest thing, but chose to stick with my Universal policy. In retrospect, I choose correctly especially with the 4% guarantee that went with my Universal because the Variable Life went way below that and the Universal interest rate guarantee out performed it. I also purchased an upgraded whole life policy and have done just as well with it. Again, the Variable life I was offered didn’t outperform what I already had. Good luck in your quest.
2. if you want universal life, you could also opt for a fixed life universal life policy. you won't have to worry about choosing where your money is invested in like a variable life policy, it is done for you. you can also design the policy to pay one level premium for the life of the policy and some policies will guarantee coverage beyond age 100.
3. I am in the insurance industry and always, I mean always! But term insurance (level term) and stay away from all types of "cash value" insurance its the biggest rip off. Universal Life is basically a "pick a payment" insurance policy where your face amount and cash value are dependent on how much you pay. However they use a annual renewable term as a rider. So initially the insurance is cheap however when your older, its gets really expensive and your premiums will go up. Then if you dont pay the amount needed they will take your premiums from the cash value, and all your money goes to them. Buy term insurance at least 30 years level and invest the difference into a mutual fund. There is a company call Primeica Financial Services. I think you should give them a call they built a whole company to help people with this situation.
4. Check out some of the highest rated insurance companies. They provide planning for the top corporations, CEO's, and affluent in the country and DO provide permanent insurance for clients. These folks (both clients and companies) understand the deep value of permanent insurance and can test your risk tolerance and need for it..... My recommendation would be to look at New York Life Insurance or Northwestern Mutual Life. They are both the top rated companies (means they will be there for many years) and are mutual life insurance companies....The value of that is that they are not stock companies...they are not publically traded...The policy holders are actually the owners of the corporation...good luck...you are asking a great question... If you have more questions go to my 360 and drop me a message...
5. sorry Brian C is dead wrong !!! and he's in the business??? Here is what I found out. Variable I'd stay away from due to market fluctuations, if the underlying funds do poorly, you may need extra money to keep it going each month, or "overfunding" the policy. I actually love Universal with a guaranteed interest rate, usually 3%. have an agent illustrate a no-lapse premium at the minimum 3% carrying the death benefit until age 100. premiums will not change as long as you pay on time. However, the interest rate can go up, just not below the 3%. A lot more people are doing a "Combo" plan, half term, half Universal, guess why? when the term runs out, you have squat left over, however if you combine them, the universal will keep going, and then when the term runs out, use the extra money your not paying on the term and overfund the universal? seems like an awesome plan. Most young people get term cause it's cheap, but what happens if it runs out at age 65, and you got sick at age 67 and passed on at 68?? You get ZILCHO !! good luck..........combo plan is best.
6. Depending on your age, I personally would go variable. The reason I would go variable is because I understand the importance of aggressively trying to build cash and I get 4.5% in my savings account. After tax, it is still greater than the tax deferral at 3%. Don't look at it as if you are buying but investing in yourself for a return later down the line. The average return in the market in any ten year span has been roughly 8%. factoring those bad years and sticking with a well disciplined allocation strategy or asset allocation fund where the professional folks who do this everyday are doing this is a plus. All insurance is insurance but all companies are not equal. All companies investment options are not equal either. So pay attention and read the prospectus. Hope this helps.