Universal life insurance is a permanent life insurance policy. That means it never expires as long as you pay the premiums up until the time of your death. This type of policy also has a flexible savings element that helps you save money. This policy does not have a specified end date, but the terms may change depending on your circumstances.
Premiums and Interest
You must pay monthly premiums to keep this coverage active. Your premiums are divided between death benefits and the savings account, which is also called cash value. You can borrow money from the policy depending upon its terms and conditions.
The cash value accrues interest and continues to grow while the policy is active. You can direct value from the interest towards premium payments. Depending on the size and performance of your investment, the gains can be used to cover premiums rather than funding the policy.
Is Universal Life the Best Choice?
Universal life is a good choice, but it is more expensive than other types of life insurance. If you want to protect your family from losing a major source of income, then you may want to consider this policy. It will help you build long-term assets.
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