Pros and cons of universal life insurance

Understanding the basics of the major types of life insurance is important to help you choose the right one for yourself and your family’s needs. Universal life insurance is similar to whole life insurance. It is permanent life insurance with an investment savings aspect to it. Universal life insurance is the most flexible life insurance policy. It is for anyone who wants life insurance. Certain plans can have higher premiums, while other plans can have lower premiums.

One aspect of universal life insurance that makes it a great option is that you can choose to pay more than the monthly premium. If you choose this option, the extra money you’ve put into the plan will go into a cash account to grow over time. You can also choose to pay less than the monthly premium. The cash account will be used to cover the difference. However, if you don’t have a cash account with your insurance you could have a lapse in coverage.

You can also change the amount of coverage you receive with universal life insurance. You can decide to increase or decrease your death benefit if you want more or less coverage. Universal life insurance has flexible premiums, flexible benefits, and a growing cash value.

Universal life insurance does have some risks. One of the risks is if you choose to pay less than your monthly premium and you do not have enough cash reserve to cover the difference. There is also a risk of losing money in this account. The cash account will grow like the market, meaning it could lose money depending on where the market is.