Universal Life Insurance

Universal Life Insurance is a flexible-premium, adjustable benefit life insurance policy that accumulates account value. The flexibility of this policy allows you to change the amount of insurance as your needs for insurance change. Universal life is similar in some ways to, and was developed from whole life insurance. The potential advantage of the universal life policy is in its flexibility and the potential for greater cash value growth during the insured's life.

Universal life insurance tends to be more expensive than term life insurance. This discrepancy is the result of how the premiums are calculated. As morbid as it sounds, life insurance costs are determined by how likely you are to die over the term of the policy so young person will usually pay a cheaper premium than an older person because young people are less likely to die during the course of the policy.

Universal life insurance is usually permanent, and insurance companies take this fact into consideration when calculating the cost. The premiums tend to be higher but should remain the same over the life of the policy; thus, though someone may be paying more for insurance when they are younger, they should be paying less for insurance when they are old.

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