What does it cost to borrow from a variable universal life insurance policy?
the interest rate is stipulated in writing in the life insurance policy
Can variable universal life insurance be converted into a fixed account?
Variable universal life insurance is not an account. It is a policy that invests in separate accounts in an attempt to earn higher returns than a fixed policy. A variable universal life insurance policy can be converted into a different type of life insurance policy but not a different kind of account.
Can you borrow from your insurance policy?
Borrow - No. You cannot borrow directly from your insurance policy. But, you can borrow with your insurance policy as "collateral". Only certain types of insurance policies where there will be a guaranteed payout at maturity will be eligible for loans. Simple pure term policies that pay nothing if you outlive the policy period will not be eligible for these type of loans.
What is it called when a insurance policy is paid up?
"Paid up" is actually the terminology used in the insurance industry when describing a policy that no longer requires any premiums. When a policy is "paid up", there are no further premiums required for the policy to continue on for what should be lifetime. This can only occur with permanent forms of Life insurance such as Whole Life, Universal Life and Variable Universal Life.
What type of life insurance product has variable premiums and face amount?
Universal Life insurance has variable premiums built into the policy (whether traditional Universal Life or Variable Universal Life). However, many people end up paying less than they need to and the policies don't work out the way they planned. If you do a Universal Life policy, make sure you have a trustworthy agent. As for variable face amounts, some term policies have built in options to enable increasing the face amount of the policy at…
What is variable universal life insurance?
Variable universal life insurance combines the flexibility of a universal life insurance with the investment account features of a variable life insurance. Like variable life insurance, variable universal is considered a security. It can only be sold by agents who have passed the National Association of Securities Dealers (NASD) exam. Answer Variable life insurance allows you to control your portfolio of investments that is part of the cash value component of a whole life insurance…
What is a universal life insurance policy?
A universal life insurance policy is a cash value type of life insurance policy. With universal life insurance, you policy may build up cash values over time, similar to a whole life policy, but typically less expensive than whole life insurance. Another feature of some universal life insurance policies is called a "no lapse guarantee" With this feature, as long as you pay your premiums, the policy is guaranteed to last to age 100 and…
What are some precautions when considering an indexed universal life insurance policy?
Indexed universal life insurance policies are similar to traditional universal life insurance in most ways. Traditionally a client is given the option to have a fixed rate or a variable rate for the entire policy with no cap on potential gains. While an Indexed policy gives the client the option to have a percentage at a fixed rate and the remaining portion in specific investments. With this hybrid style, there is less management resulting in…
Can you borrow money from a universal life insurance policy?
Most Life insurane companines allow you to borrow money from your Universal Life Policy. There will be an interest rate charged, the interest rate will be reflected in your policy under "Loans". You will only be able to borrow against the cash accumulation account. The amount in the account is usually the difference between the cost of insurance, plus expenses and the amount that you have been putting into the policy, plus any earned interest…
Can you cash in your universal life insurance?
Yes you may definitely cash in your variable Life Insurance. Remember though that it has a life insurance element e, so when you cash in everything, your policy will be canceled. You may instead cash in 80% of the fund value then start paying for the charges for your policy if necessary. Your Variable Life Insurance is your investment, savings, insurance in one and it works best in times of needs. Remember to talk to…
Is it best to borrow or surrender the cash value in a universal policy?
That depends on whether or not you wish to continue having the life insurance in force at the insured's death. If you wish to have the life insurance in force at death, then it is best to borrow some of the cash value. If you surrender the policy, then you receive all the remaining cash value (less any surrender charges), but the death benefit is no longer there. Also the cash value received MAY be…
What is better Variable Universal Life or Universal Life?
Without knowing your circumstances, wants, needs and desires - the question can't be answered. I would suggest that you get proposals for both and then make a decesion. I agree with the previous person's answer. Generally speaking, Variable has a higher upside potential but no minimum floor. Universal Life has a guaranteed floor, but a smaller upside potential. A variable universal life policy is more subject to market risks. The policy holder is allowed to…
A variable life insurance policy is defined as what?
A variable life insurance policy is an insurance policy that allows the policyholders to invest their premiums in a variety of stocks and funds (options vary depending on the individual policy). This type of policy differs from a whole life insurance policy in that monthly premiums do not necessarily have to be paid (depending on the value of the investment accounts), and a month without a paid premium does not void the policy. Additionally, if…
What is special about a universal insurance?
Universal life insurance is special in that it allows the policy owner to alter the time period and amount of premium payments as well as the death benefit and you can do this while the policy is in effect. However the altered payments must be with limitations of the company you are getting the insurance through.
Where can someone find information about what is the difference between whole life and term life insurance?
The basic difference between term and whole life insurance is this: A term policy is life coverage only. On the death of the insured it pays the face amount of the policy to the named beneficiary. You can buy term for periods of one year to 30 years. Whole life insurance, on the other hand, combines a term policy with an investment component. The investment could be in bonds and money-market instruments or stocks. The…
What is the primary difference between universal life and variable universal life?
The primary difference is how the cash value is invested. Variable universal life means it is invested in stocks and mutual funds and a "fixed" universal life is usually dependent on interest rates. Both carry high risk, but a fixed universal life policy gives you a guarantee that it will not go below a certain interest rate, while variable universal policies usually do not.
Can you borrow money against your life policy?
Yes, if your life insurance policy has accumulated cash value. Not all life insurance policies will accumulate cash value: for example, term life insurance policies will not accumulate any cash value. Whole Life and Universal life policies can accumulate cash value and the policy owner can take loans in the limit of the cash value (some companies limit loans to 70 - 80% of the cash value).