0
Want this question answered?
Be notified when an answer is posted
Add your answer:
Earn +20 pts
What is the difference between universal life insurance and the other alternatives?
Universal Life is a type of permanent life insurance based on a cash value. That is, the policy is established with the insurer where premium payments above the cost of insurance are credited to the cash value. The cash value is credited each month with interest, and the policy is debited each month by a cost of insurance (COI) charge, and any other policy charges and fees which are drawn from the cash value if no premium payment is made that month. The interest credited to the account is determined by the insurer; sometimes it is pegged to a financial index such as a bond or other interest rate index.
Does the cost of insurance increase in a universal life insurance policy?
It depends on the policy, but in many cases yes. Universal Life has many of the same characteristics of Whole Life insurance (i.e.- cash value)but is "technically" speaking Term Life that is renewed on a regular basis like every 5 yrs or even yearly. If you are unsure whether the price of your policy premiums will increase you can check the "cost index" page of your policy and you should be able to see if the price increases over time.
What is IUL life insurance?
IUL stands for Indexed Universal Life Insurance. Indexed means it follows the S&P 500 or another stock market index. Universal life is a type of insurance. It does not carry as many guarantees as whole life, but has its place.
What is an equity index universal life insurance policy?
Equity Indexed Universal Life contracts that invest in Index Options on the movement of an Index such as the S&P 500, Russell 2000, and the Dow (to name a few). These type of contracts only participate in the movement of Index and not the actual purchase of stocks, bonds or mutual funds. They may have a cap (but not always) as to the maximum amount they will credit interest to and a minimum guarantee which keeps the principal of the contract from losing money in a down year. Typically each year the starting point is last year's ending point which means that: (1) the policy amount is locked in at the end of the year; and, (2)the beginning value from which the movement measured is reset. source: http://en.wikipedia.org/wiki/Universal_life_insurance
Where a Surrender Cost Index is described in a Term Life Insurance Policy does it mean the policy owner must pay to cancel the policy?
The Surrender Cost Index can be used, as one factor, to give the buyer a convenient way to compare relative costs of similar policies. They take into account a number of variables. This index is generally not helpful in comparing term life policies, as the majority of term policies do not have a cash value or a surender value.In evaluating policies with a cash value and a surrender value, the general rule is that the smaller cost index is the better buy. Cost comparisons should only be made between similar life insurance plans. Those policies should provide the same basic benefits and require roughly the same premiums for the same amount of time. The more identical the policies are, teh more reliable the cost comparison will be. It is also important to note that you should compare index numbers only for the kind of policy for your age and the amount you should buy. No one company offers the lowest cost for all insurance, at all ages. If there is only a small difference between index numbers, consider other features when making your choice including service.Life insurance cost indexes apply to new policies. You should not use them to determine whether to drop an existing policy.
What is the difference between variable life insurance and universal life?
Nothing is the difference. Universal Life can be fixed or variable. Variable simply means that the cash value is invested in stocks or mutual funds to create a fast (sometimes slower) cash value. With a fixed Universal Life product, the cash value can be linked to an interest rate or an Index.
What is universal life insurance?
Universal life insurance is a type of whole life insurance. Universal life differs from other whole life policies in that it allows the policy owner to vary, with limitations, the amount and timing of premium payments and the death benefit. These changes can be made while the policy is in effect. Universal life is NOT whole life. Universal life is Annual Renewable Term plus cash value (a savings). Look at your universal life policy. First, look on the page that shows your policy number, name, coverage amount, etc. Look to see if you have option 1 or option 2 (it may be under option I and option II, or A,B) If you have option 1 - your beneficiary only gets the FACE AMOUNT. Assume you have $100,000 of coverage and $5000 of savings. When you die, your beneficiary only gets the $100,000! However, if you have option 2 (which usually has a higher premium) your beneficiary gets BOTH the face amount plus the cash value. Having that knowledge, who would choose option 1? It's usually never explained. Also, if you look at the index of your policy, you can look up the definitions of Option 1 and Option 2, With Universal Life being Annual Renewable Term (plus cash value), the cost of insurance goes up every year because the odds of dying are greater. There is a table that shows your cost of insurance per $1000 of coverage in your policy. Look at how the cost goes up EVERY YEAR. But your premium doesn't neccessarily go up. Eventually what happens is that your monthly premium can't cover the cost of insurance, so the company will take money out of your cash value. (Ever hear it will pay for itself?) Yet, you'll get to a point where you have no more cash value left, and the premiums are too expensive to continue the insurance. Once again, the insurance company wins. Universal life is neither whole life or annual renewable term. It is a distict animal all it's own. The basic premise in universal life is that the cost of insurance for younger ages can (and should) be overfunded. This amount of overfunding is the cash value. The benefit of this strategy is that the cash value can grow at a modest market sensitive interest rate and can accumulate to a point where the internal cost of insurance can be subsidized by this cash value when the premiums are insufficient to pay for the COI. Based on the future experience of the crediting interest rates, a reasonable approach can be taken to increase or decrease premiums as required to keep the policy in force for a specified period of time. UL cannot effectively be compared to term insurance, nor is it easy to compare to Whole Life policies. The differences in Options 1 & 2 death benefits are associated more with the desire to view the instrument as a life insurance policy or a cash accumulation vehicle. There are many other factors that should be looked at to maximize the benefits for either situation, but that being said, they can function as either a cash accumulator or a death benefit engine economically but can not be both at the same time. A permanent life insurance policy has three components - the death benefits (protection), the expense component and the cash value component. A universal life insurance policy will differentiate and itemize these three components, which will allow for more flexibility in the policy. The policy owner then has the facility to modify the face amount or the premium rate (under specific guidelines) to meet with changing circumstances and needs in his or her life.
How do you locate an old life insurance policy for an old company that moved called Interstate Life and Accident Insurance Company?
Doing a google search - mergers, aquisitions - it's now owned by AIG http://www.americangeneral.com/lifeinternet2000/careerweb.nsf/contents/index
which life insurance is better?
I'm here to help, but I need more information to provide a specific answer. Choosing the right life insurance depends on various factors, including your individual needs, financial situation, and goals. Here are some common types of life insurance to consider: Term Life Insurance: This provides coverage for a specific term, such as 10, 20, or 30 years. It's generally more affordable but doesn't build cash value. It's a good choice if you need coverage for a specific period, such as to cover a mortgage or your children's education. Whole Life Insurance: This is a type of permanent life insurance that provides coverage for your entire life. It also has a cash value component that grows over time and can be withdrawn or borrowed against. Whole life insurance tends to be more expensive than term life but offers lifelong coverage and potential savings. Universal Life Insurance: Similar to whole life, universal life insurance is a permanent policy with a cash value component. It offers more flexibility in premium payments and death benefits, allowing you to adjust them over time. However, it's important to manage the policy properly to prevent the cash value from depleting. Variable Life Insurance: This type of policy allows you to invest the cash value in various investment options, such as stocks and bonds. While it offers potential for higher returns, it also comes with higher risk due to market fluctuations. Indexed Universal Life Insurance: This combines features of universal life insurance with the opportunity to earn interest based on the performance of a stock market index, offering potential for growth without directly investing in the market. The best life insurance for you depends on your financial goals, risk tolerance, budget, and needs. Consider factors such as how long you need coverage, whether you want an investment component, and your overall financial situation. It's also recommended to speak with a financial advisor or insurance professional who can provide personalized guidance based on your specific circumstances.
What is better - a machinability index of 100 or 0?
100
Why is HDI better than GDP?
it is better because it measures the life expectancy index, education index and the income index and square roots it by the power of 3. it is taking in account several types of indexs and getting an average (kind of!)
Who publishes annual indexes of auto insurance company ratings?
StateFarm publishes an index of auto insurance company ratings, which can be searched according to vehicle make. The index contains information about collision damage, theft damage, vehicle safety discounts and liability ratings.
