Life insurance investment requires a cautious and prudent approach. The universal life policy plans have certain features and benefits, as explained below, that make it a popular option for buyers in China, Hong Kong and Indonesia.
Traits of Universal Life Insurance
Universal life gives you greater freedom to plan an insurance combination that suits you the best rather than following a rigid framework. Any figure that falls in the maxima –minima range as fixed by the IRS is acceptable. Premiums can be increased, decreased, or even avoided altogether, as per your current financial situation.
Adjustable Death Benefit
In contrast to term insurance, the death benefit can be changed, while complying with the broad limits set in the contract, without having to opt for a new policy altogether. This continued protection even if the basic requirements change is a unique feature of universal life.
Change in Credited Interest
The insurance company has the right to periodically change the interest rate that is credited. However, this rate will never go down the minimum amount stipulated in the contract. It is this feature along with the dividend earned on the amount invested that leads to lesser premium amounts as the company can earn returns from the market.
Universal Life in China, Hong Kong, Indonesia and most other parts of the world offers two separate plans to treat death benefit, Level Death and Increasing Death. Level Death Benefit option, offers the death benefit to be the face amount only. The net risked amount is the difference between face value of the policy and the current policy value, which keeps on decreasing as the policy value increases. This lowers the cost of insurance. On the other hand, the Increasing Death Benefit option offers the sum of the contractual policy figure and the latest policy value as the end gain. This increases the long term expenses due to increasing cost of insurance but accumulates a larger amount at the time of death.
Why Opt for Universal Life?
It takes away the frown from your forehead as paying off educational loans, estate taxes and mortgages becomes a cakewalk with direct withdrawals or taking a loan against the accumulated cash value of the policy. It’s an all smiles proposition as these loans and withdrawals are tax-deferred.
Stable Flow of Income
UL ensures that the deceased is missed is only emotionally and not because of financial strains as the death benefits keep the stream of income flowing continuously to the family through interests, dividends and/or lump-sum payment.
The long-term multiplying effect of the cash value helps you to plan in advance the equitable income value that is to be distributed among your beneficiaries. Prior calculations can be done to help figure out your post retirement plans as well.
Use the below given universal life sites to educate yourself about your life insurance needs. Get life insurance rates for Term, Whole, and Universal Life Insurance.
Universal Life Hong Kong & China: Universallife.com.hk
Universal Life Indonesia: Universallife.co.id