• 516-944-0200
  • 516-944-0200

Universal Life Insurance

Universal Life Insurance (UL) is a type of permanent life insurance. Under the terms of the policy, premium payments above the current cost of insurance are credited to the policy’s cash value. Each month, the cash value is credited interest and the policy is debited each month by a cost of insurance (COI) charge, as well as any other policy charges and/or fees which are drawn from the cash value – even if no premium payment is paid that month. Interest credited to the account is determined by the insurer but has a contractual minimum rate of between 2% and 4%.
Variable Universal Life Insurance (VUL) is a type of permanent life insurance that builds a cash value. In a VUL, the cash value can be invested in a wide variety of separate accounts, similar to mutual funds. The choice of which of the available separate accounts to use is entirely up to the contract owner. The ‘variable’ component in the name refers to the ability to invest in separate accounts whose values vary (being some are invested in stocks and/or bond markets). The ‘universal’ component in the name refers to the flexibility the owner has in making premium payments. The premiums can vary from zero in a given month up to maximums which are defined by the Internal Revenue Code for life insurance. This flexibility is in contrast to whole life insurance that has fixed premium payments that typically cannot be missed without, or the policy will lapse.
Indexed Universal Life (IUL): IUL policies offer tax-deferred cash accumulation for retirement while maintaining a death benefit. People who need permanent life insurance protection but wish to take advantage of possible cash accumulation via an equity index might use IUL policies as key-person insurance for business owners, premium financing plans, or estate-planning vehicles.
Survivorship Universal Life (SUL) or sometimes referred to as a Second to Die policy, is a type of permanent life insurance protection in which two lives (usually spouses) are insured under one policy. Under this type of policy, the death benefit is generally paid out upon the death of the second insured, although some carriers offer policies paying benefits upon an initial death. Survivorship life insurance can take the form of whole life or universal life and are generally for estate planning purposes.

Guarantees and protections are subject to the claim’s paying ability of the issuing life insurance company. They do not apply to the investment performance or safety of the underlying investment options.  Variable products are sold by prospectus. You can obtain the product prospectus and underlying fund prospectuses by contacting the insurance company. Before you invest, you should read the prospectus carefully and consider investment objectives, risks, charges, and expenses. The product prospectus and underlying fund prospectus contain this and other important information. Indexed universal life insurance policies are not stock market investments, do not directly participate in any stock or equity investments, do not receive dividend or capital gains participation. Past performance of an index is no indication of future crediting rates. Taking money from your policy immediately reduces both the cash value and the death benefit payable and can cause the need for more premiums to be paid into the policy in the future. You should always take care to ensure that your life insurance needs continue to be met over time subsequent to taking cash from your policy.