Does Universal life insurance policy have a cash value?
Ted
Kileen,TX.
Ted,
Universal life policies allow you to fluctuate or even skip premium
payments, which in turn adjusts your death benefit amounts.
Unlike term life insurance, which is easily compared online, cash value
insurance is often marketed by agents and brokers in a face-to-face setting, where needs and strategies can be discussed.
Because of the complexity and dizzying array of possible outcomes for
permanent life insurance, regulators insist that cash value insurance be sold using pre-approved illustration formats. These illustrations can run to 15 or more pages. Cash value life insurance illustrations are divided into two major sections: guaranteed values and projected or illustrated, non-guaranteed amounts. Illustrations can be complex and hard to compare in an apples-to-apples way.
Pay particular attention to the guaranteed death benefit and premium-payment sections because these columns contain the actual company promises. If you don’t like what you see there, walk away.
Another caveat: Many cash value policies contain harsh penalties for
surrendering the policies in the early years. Changing your mind within the first few years is an expensive one.
Great Question.