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Life Insurance Companies: Universal Life Coverage Offered By Life Insurance Companies
The article describes the Universal Life Coverage offered by Life Insurance Companies. Universal Life Insurance policies allow for changes in the amount covered. |
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| Universal life coverage offered by life insurance companies |
Various types of Universal Life Insurance policies are being offered by Life Insurance Companies. To provide your loved ones with benefits at your death is the main purpose of Universal Life Insurance policies' as with all life insurance policies. However' the Universal Life Insurance policies allow for changes in the amount covered and the premium payable from time to time according to the needs of the insured. If your finances permit you can increase the premium or make lump sum payments and thereby increase the value of benefits that you or your beneficiaries will receive.
Universal Life Insurance is a recent innovation. It guarantees a payment to the beneficiaries at the time of your death. However' the amount payable will depend on the changes in the policy made by you from time to time. Unlike other life insurance policies' it may not be the amount agreed at the time the insurance policy was issued.Here is an example of how the Universal Life Insurance Policy offered by a reputed Insurance Company works;
• With each premium payment 5% is deducted for expenses. The balance is credited to the account holder’s account.
• The account holder’s account is credited with interest monthly' at the current rate or a minimum of 4% per annum.
• Premium payable is at the discretion of the account holder within the amounts specified in the policy.
• The amount insured can also be adjusted monthly as specified in the policy.
• Loans can be taken' but there will be a reduction in the death benefits.
• Cash withdrawals will reduce the benefits.
• There will be a surrender value in case the account holder wishes to surrender the policy
There may be several variations in the Universal Life Insurance Policies issued by different Life Insurance Companies.
According to the present laws the death benefits received by the beneficiaries on life insurance policies are not taxable. |
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