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Thursday, December 30, 2010

Universal Life Insurance (ULP)- an introduction

Universal insurance policy-
Universal Life insurance is a type of permanent life insurance policy. Unlike other insurance policies one can change the policy amount .At times the insured finds it difficult to pay the premiums because of some financial commitments. On such occasions the insured is not able to change the policy amount this policy allows the insured to change the policy amount.
Some of the advantages of this policy are as follows:

Innumerable death benefits-This policy allows flexibility in the amount of death benefits. You are free to change them to suit your convenience. There is another special feature associated with universal life insurance policy. The policy provides for lapse protection which entails you to enjoy the benefits as long as you pay the premiums regularly. Even if it does not have the provision of lapse protection the maturity amount will be paid in the event of death after deducting the money borrowed.

Premium Options

The insured is at liberty to make his choice in paying the premiums. You can either pay the premium at regular intervals or in one stroke. However you cannot change the amount of premiums to be paid.. You cannot pay less or more that the prescribed limits. Your dependents will not be able to enjoy the death benefits if you fail to pay the premiums. 

Death benefits

There are two types of benefits during death when a person chooses a universal insurance policy. When a person invests in this policy the increase or decrease of his cash value does not influence the policy amount. Moreover when there is an increase in cash value the insurance company creates an extra insurance policy for the increased amount.

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