How Universal Life Insurances Can Be Popular When It Is For You.

Of all the different types of policies, the universal life insurance seems to be the most favorite among today's policyholders. It is a much later innovation, conceived to meet a modern need. However, it does not mean that the earlier policies have all become redundant. No, even term life, the original life insurance policy, has quite a big following even today and so have the whole life policies. Nonetheless, people seem to prefer universal life because it combines the low cost protection of the term life with the saving elements of a whole life to provide a perfect solution to modern insurance need.

The term life is the original type of insurance policy am sure you are aware. In the form of burial clubs and artisans guilds in the Middle Ages, but the term insurance that we know of today is a much refined version indeed, life insurance may have actually started. It is a pure life insurance policy valid a temporary period only. You can buy one for a period of 1/5/10/15/20/25/30 years. At a very reasonable rate since these policies do not accrue any cash value, you can have a large coverage.

Unless you die within the valid period, the term insurance policies offer no return on the con side. As its antidote the whole life policies were next conceived. They had saving element incorporated in them. Such policies were little too expensive and premium payment mode was little too rigid however. The universal policies came next. Because it offered more flexibility when it comes to cost and coverage it became instant hit.

Indeed, if you want to take advantage of the market without loosing the security of the life policy, there can be nothing better than a universal life. Following are some of its salient points:

It is a permanent policy valid for the life of the insured and so whenever the insured dies, his beneficiary is sure to get the benefit.

These policies are slightly overpriced and amount paid above the cost of insurance is credited to a cash value account.

Interest too is credited to the account. It may either be determined by the insurer or pegged to financial indexes such as stock, bond etc.
Thus keeping policy in force in spite of occasional lapses if you fail to pay the premium, the amount will be debited from this account.

Which allows the cash value to be directed to a number of separate accounts that operate like a mutual fund today we also have variable universal insurance. But if the market goes down, they offer greater risk too however, since these policies are equity based, they can offer higher return.

However, it is not for me to tell you what type of policy to buy. Receive different categories of life insurance quote on line and then decide. All said and done, I cannot stop myself from adding that, for life insurance purpose, you will do well if you buy only a term life insurance. It is true that a term life does not offer cash value, but its rates are so low that only a financial fool will expect it from the policy. Instead, the financial advisers say that one should buy a low cost term life for insurance purpose and then invest the difference in separate fund.

However, not every type of term insurance is cheap. The term life insurance no medical exam policy for example is so expensive that the concept of investing the difference cannot be applicable here; in fact, the price structure of such a policy does not leave any difference to invest. Sometimes they are as expensive as a universal life policy is. Yet, such policies are no less popular because they too have some unique advantages.

No medical policies provide instant coverage. By the policy from tomorrow and that too for the full amount you apply today and if you qualify, your family will start being covered. Every other type of death in included under this policy of course, just as every other case, suicide within first two years is always excluded from its purview; otherwise. The carriers can never work out the exact cost of insurance and so they charge more actually, without the medical test. Remember, they are here to do business, not for charity.

Article by David Livingston of EQuote, who is a specialist in everything life insurance. For more information on insurance life and term life insurance, visit his site today.