Protection and An Investment Opportunity in One Product
Another flexible alternative to life insurance is the Variable Universal Life plan. This plan provides permanent coverage while providing flexible premium payments and the ability to build cash value over time. These flexible premiums can be chosen by the policyholder, within certain limits. What separates this plan from other long-term life insurance plans is that this cash value is accumulated through the investment options of your choice.
We Can Help You Plan Out Your Investment
With a Term Universal Life plan, the investment options chosen will determine the overall value of the account. There is no guarantee that the investment options chosen for the policy will yield a positive cash value as they are subject to market fluctuations; simply put, a bad investment will equal a low valued return and can potentially raise your premium in order to meet the minimum obligations of the plan. However, much like Whole Life and Universal Life insurance plans, the insured can still borrow money against their policy via loan or withdrawal. This will decrease the cash value and death benefit of the policy if the money borrowed is not repaid. Funds can also be transferred between investment accounts, which can help the insured balance their financial needs over time and provide a strategic way of saving money in the long run.
When considering Variable Universal Life insurance, it is important to consider factors such as:
- Current financial status and ability to cover any investments lost through market fluctuation
- The risk involved in investing funds which may affect final cash value of account
- The need for permanent life insurance with a fluctuating cash value
A Variable Universal Life insurance plan is great for those looking to maximize the cash value on a permanent life insurance plan while understanding the investments risks involved. While the risk of losing money is evident, the benefit of a potentially greater cash value for your beneficiaries is what makes this plan a suitable one.