Looking to purchase a universal life insurance policy but scared that it may not turn out to be all you hoped? Here are some of the frequently asked questions about this policy to help you make up your mind.
What is universal life insurance all about?
Universal life insurance allows you a whole lot of flexibility with your premiums and death benefit. Unlike other policies, you can skip premiums if you wish to, but you should be able to maintain a minimum payment level annually.
What is the advantage of purchasing this policy?
The flexibility it offers over how you pay your premiums can be helpful in the months where you lack enough money to pay your premiums.
Can I raise the amount of my universal life insurance coverage?
Yes, you can increase the amount of your coverage. However, you may have to go through the whole process of filing for insurance again, which may include undertaking a medical examination.
Does universal life insurance come with a cash value account?
Universal life insurance comes with a cash value account which accumulates over time. You are also allowed to take out a portion of this cash value without any adverse effect on your death benefit.
Can I take out a loan and if yes, do I have to repay any loans borrowed?
In universal life insurance, you can take out loans against your policy without paying back and without it subject to tax. However, this may lead to the reduction of the total death benefit to be paid out to your beneficiary.