The insurance component of universal life insurance is priced based on annual renewable term (ART) rates. In early policy years the policies normally build up some cash value. However, that cash value can erode quickly in later policy years when the cost of insurance exceeds the annual premium and some of the cash value is silently removed to cover the deficit between the cost of insurance and the premium. Often the cash value is eventually reduced to zero and policy owner is faced with substantial increases each year for paying the premium out-of-pocket.
If you've had the policies for many years you may want to consider if they still fit in your financial plan. Many times individuals accumulate other assets and income sources that may reduce the need for life insurance.
Many universal life insurance policies are eventually surrendered or abandoned because the annually increasing cost of ART makes continuing the policy untenable.
If you've had the policies for many years you may want to consider if they still fit in your financial plan. Many times individuals accumulate other assets and income sources that may reduce the need for life insurance.
Many universal life insurance policies are eventually surrendered or abandoned because the annually increasing cost of ART makes continuing the policy untenable.
Statistics: Posted by 123 — Sat May 25, 2024 8:52 pm