Fundamentals of Universal Life Insurance

If you know the basics of insurance, universal life insurance is easy to understand. Universal life Indonesia insurance offers the low cost protection of a term life insurance as well as the saving element similar to a whole life insurance policy. Unlike whole life insurance, universal life insurance permits you to use the interest from your accumulated savings to pay premiums.

The Two Components of Universal Life Insurance

A universal life insurance policy has two components – a cash account and an insurance portion. The insurance part of the universal life insurance Indonesia is actually a renewable term insurance. In simple terms, it is a term insurance with an investment. The cash account enhances on a tax-deferred base each year and earns either the current rate, or a guaranteed contract rate, whichever is higher.

Permanent Life Insurance
Flexible Payment, Cash Value and Paying Duration

When you apply for a universal life insurance policy, you get to select the death benefit, cash value, amount of premium and premium duration, according to your financial status and requirements. The premiums, saving elements and death benefits can be reviewed and altered according to your financial circumstances.  Thus, the policy offers great flexibility.

Growth in Policy’s cash value

One of the most attractive features of universal life insurance is that the cash value of your policy grows each month on the basis of the ongoing interest rate. When you make your first premium payment for the policy, the insurer will deduct administrative fees and expenses. Any premium that is paid in excess of your expenses and fees is deposited in your policy’s cash value and starts earning interest.

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Furthermore, its growth is tax deferred. If you diligently pay your premiums, over time the cash value of your policy can grow to such an extent that it may be used to cover your regular premium payments.

Cashing out is Possible

In situations of a financial crunch, you have the option to borrow against your policy’s cash value at viable rates. Thus, it is crucial to pay your premiums and pay them on time. If possible, you can occasionally pay more, like after a salary hike. This way, you can gain benefits from your policy’s tax-advantaged interest.

This simple structure and accumulated cash value benefit gives universal life much of its premium flexibility. So, be in command; shop for the best universal life Indonesia policy that suits your requirements and budget, and gain myriads of benefits.

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Temporary vs. Permanent Life Insurance Policy

It is time to stop thinking about life’s uncertainties and start embracing long-term predictability.  People invest money in mutual funds, property, land etc. but investing in an insurance policy can also be a great way to protect your family members, even after your departure. Whether you are planning to purchase a policy or just looking for quotes, it is important to understand the types of policies available so that you can select the one that meets your requirements.  There are two general types of insurance policies – temporary and permanent.

Temporary Insurance
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It is a type of insurance policy that provides coverage for a limited period, or specified ‘term’ of years. If the insured dies during the specified time, then the death benefit will be paid. Factors to consider while opting for term policy –

–    Term of the policy
–    Premium amount
–    Death benefit

Permanent Insurance
Universal Life Insurance plans

Permanent life insurance provides insurance for your entire life (in most cases). As long as your premiums are paid, your beneficiaries will receive the proceeds, no matter when you die. The main types of permanent insurance are variable, whole and universal. Factors to consider while opting for a permanent policy –

–    Tax advantages
–    Age
–    Cash Value

Term or Permanent – Which Is Better
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Before buying a policy, it is important to categorize your insurance needs. Term insurance is appropriate for an average individual looking to insure themselves against unforeseen events. On the other hand, permanent life insurance can be beneficial for someone who wants both living and after death benefits.

Permanent Life Insurance – Enjoying Leverage over Term Life Insurance

Broadly speaking, there are three types of permanent insurance, namely universal, traditional whole and variable. Universal insurance allows you to increase or decrease your premiums, ensuring cash balance. Whole life insurance has a fixed premium and guaranteed minimum growth. Lastly, variable insurance allows you to decide how to invest the cash.

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The main aim of taking a life insurance policy is to protect your family’s financial future when you are no longer there to support them. Permanent life insurance Singapore does that for your entire life, while also offering an investment feature, i.e. savings build within the policy. You can also tap or borrow against this “cash value”. In comparison, normal term insurance policies provide coverage for a stipulated number of years for a lower premium. At the end of the term, you usually get no cash back. The contrasting features of Permanent and Term life insurance clearly gives permanent life insurance an edge over usual term life insurance.

Benefits of Permanent Life Insurance
About UsNo Policy Lapse Criteria

If you pay a certain minimum premium amount for a certain period, your policy will remain in force for the period of guarantee, even in instances where the cash values drops to zero. As long as you pay the minimum amount, your policy is unlikely to lapse. If your policy is building cash value, you also have the privilege to reduce or even stop making payments without the risk of policy lapse.

Avoid Tax Payments

The cash that builds in Permanent life policies is not taxed till it is withdrawn. Additionally, you can avoid even those extra taxes by applying for a loan against the account. This makes permanent life insurance highly beneficial for people from high income groups, who can maximize their tax-deferred savings. Additionally, as permanent insurance lasts a lifetime, it is suitable for senior citizens who have illiquid estates and wish to pass on their money. Here, the death benefit is even more than what they would be able to save.

Buy Permanent Life Insurance Singapore from a Credible Provider

Main FeaturesIf you believe that you are a candidate for a permanent policy, it is advisable to find a provider that offers beneficial policy offerings. Use the power of the Internet to explore different permanent life insurance providers and choose the one that offers the maximum benefits. When it comes to life insurance, the right choice can make all the difference!

Reasons to Opt for Universal Life Insurance in Singapore

Universal Life Insurance is a specific type of flexible permanent life insurance, prevalent mostly in the United States and some other parts of the world, such as Singapore. In this type of policy, the excess premium over and above the current cost of insurance is credited to the cash value of the policy every month along with the interest accrued. In universal life Singapore insurance, the cost of insurance (COI) charge and other charges and fees are drawn from the cash value of the policy.

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The insurer determines the insurance to be credited to the account but has to deliver a contractual minimum rate of 2%. The policy is termed as an “Indexed Universal Life” contract, when the earnings rate is pegged to a stock, bond or any other financial index.

The relevance of Universal Life Insurance is on the rise globally, as life insurers in some of the booming Asian economies are challenged to introduce products reflecting the needs and requirements of the customers of today. The customers can opt for Universal Life Singapore insurance policy for wealth creation, wealth distribution, legacy planning, and even in the instance of protecting their interests as shareholders in family businesses.

Many people in different parts of the world are realizing the various Benefits of Universal life insurance plans that offer both the low cost protection of term life insurance, as well as a savings element providing a cash value buildup. The policyholders are also free to alter the death benefits, savings, and premiums as per their circumstances. The interest accrued from policy savings can even be used to pay premiums. Customers can also make the most of a growing cash value of investments, where the rate of growth is variable and adjusted monthly.

Permanent life insuranceUniversal life Singapore insurance would remain in force for the period of guarantee even when the cash value drops to zero. Such plans come with a no lapse guarantee and would not lapse if certain minimum premium payments have been paid. Owners can also use these plans to bring down their premium outlays to a minimum.

Given all the merits, more people looking to enhance and protect their wealth are opting for Universal life plans from leading insurers that have considerable experience in the domain. The policy holders have everything going in their favor. They have a guaranteed return throughout the life of the policy, and a cash value from which withdrawals can be made without having any effect on the lump sum benefit.

Universal Life Insurance – Get the Flexibility to Adjust Your Changing Requirements

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No one can run away from the surprises of life, but we can definitely make adjustments. Insurance needs change with life, which makes it important to search for a policy that provides you with the flexibility to adjust your premium payments. There are different types of policies available; however, if your requirements are ‘flexible,’ a Universal life insurance policy promises the ideal solution.

Also termed as ‘adjustable life insurance,’ Universal insurance policies offer higher flexibilities as compared to all other types of policies.  It provides the buyer the liberty to reduce or increase their death benefit and also pay their premiums at any time, once their first premium payment has been made. In fact, these policies also allow you to change your premium amount and increase the face value of your insurance coverage.

The Benefits

Helps You during Your Hour of Need

When you buy a Universal Life Insurance policy, you get cash value, which can be used to pay premiums in case of a financial hitch. If you have cash value, your policy will not lapse even if you fail to pay a premium. However, make sure to discuss the status of your cash value fund with your insurance advisor.

Universal Life Insurance

Provides Alternative Policy Loan

An alternative policy loan is another benefit promised by Universal insurance. However, it is important that you do not make regular withdrawals from your accumulated fund because it will reduce the cash value of your policy.

Universal policy is designed to give you and your family lifelong security, as per your requirements. If you stay in Singapore, simply search the web using keywords such as ‘Universal Life Singapore,’ or ‘Universal Life Insurance’ to get a list of the best permanent life insurance providers.

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Generic Characteristics of Universal Life Insurance

life insurance SingaporeUniversal life insurance is a type of interest sensitive whole life insurance policy that offers flexibility in the amount, method, and timing of premium payments. Cash value is created with time, and policy holders have the option to borrow or withdraw from the same. There are a few plans that guarantee a minimum interest crediting rate and are popular among high net worth individuals. Policy holders can use these plans for wealth creation, wealth transfer, estate distribution, and legacy management purposes.

In Singapore, Universal life policies are registered and approved by the Monetary Authority of Singapore (MAS).  This organization endeavors to promote sustained and non-inflationary economic growth in the country through carefully designed monetary policies and macroeconomic evaluation. Universal life insurance in Singapore has come a long way since it was introduced in the country back in 2003, with many local companies today coming up to cater to the increasing demand.

To get a better understanding of this product, you would need to understand its generic characteristics, some of which are mentioned below.

life insurance Singapore

• Caters to a target market – This is a product created for high net worth clients in both local and global markets.

• Offers high permanent coverage – The coverage for these policies are really high starting at about $ 500,000.

• Comes with a high age of entry – Applicants up to the age of 60 can apply and use the plans for estate and wealth management purposes.

• Premium financing possible – You can invest single or regular premiums and work with banks to finance the amount.

The option for interest crediting exists, with accounts earning interests at rates that change with time. Most plans come with a minimum interest rate, which is generally better than the interest rates being paid on bank deposits.  If the cash value or the premium payments are not sufficient to cover the cost of the insurance, the death benefits might not be available. However, you can add a guarantee to your policy to keep it effective when certain premium payments have been made. The policy would not lapse even when the cash value drops to zero.

Improve Returns and Reduce Risk with ‘Living Benefits’ of Permanent Life Insurance

permanent life insurance

Sometimes in life, we feel that we see things clearly, but we might be missing some vital elements. Life is uncertain, and we never know what the future may bring. In a world of uncertainties, it is important to ensure that we live a happy life, and our families remain financially secure even if we are no longer there with them. There are numerous ways to invest and have a secure financial future; however, most investments are ‘subject to market risks’. In contrast, a life insurance policy, if chosen correctly, can be remarkably beneficial in the long run.

Whether you are seeking additional, new or alternative life insurance, you could easily be confused by the marketing strategies and arguments of insurance agents. Life insurance policy is quite similar to buying a property because it depends solely on the needs and finances of the buyer. However, when it comes to buying life insurance, there are various merits of Permanent Life Insurance as compared to Term Insurance Policies. In fact, permanent insurance also provides numerous living benefits because the cash value builds overtime, and once it amasses, it can be used to improve your family’s life and secure their future.

The ‘living benefits of a permanent insurance policy

Permanent insurance is a win-win because it provides huge ‘living benefits.’  Some important ways in which you can use these benefits are:

Education
Every parent wishes to give the best education to their children; however the high fees involved with higher education often puts an end to this desire. If you have a permanent policy, college and other living expenses can be paid using insurance cash value. Various parents buy permanent insurance plans to be able to pay high college fees in the future.

Generating Business Cash
If an opportunity arises or your business requires instant cash, you can access the cash value of your permanent policy instantly, without any lengthy applications and approval processes. It is a great way to avoid business loans and the interests involved.

Funds for Emergencies
Whether it is illness, home repair, or any other need that requires instant cash, you can speak with your insurance agent and include a financial security plan that manages risks in your policy.

With correct planning, protection and accumulation, a Permanent life insurance policy can help you build a stable foundation for life. Find an instant policy quote online and get in touch with our financial representatives to discuss your requirements today!