David Murdock leads the Life Insurance, Healthcare and Group Benefits division of The Prewitt Group. In addition to life insurance, David has expertise in disability income products, financial planning, group insurance and long-term care. Below he gives insight into this FAQ.
David shares that Universal Life (UL) insurance combines elements of term life and permanent life insurance with an investment savings element and low premiums that are like those of term life insurance. Many UL policies contain a flexible-premium option that relies on the performance of the underlying investment to support the cash values of the policy and the death benefit.
Like term insurance, at death, a beneficiary only receives the death benefit, but UL provides insurance beyond a typical term of 10, 20 or 30 years. “Flexibility” is most often associated with UL because of the design options available, whereas term and permanent insurance have fixed premiums. There are a number of caveats with flexible premium insurance products that accumulate cash value, like, what happens when I take cash out of the policy, what happens if I skip a payment, and what if credited investment interest doesn’t maintain policy premiums?
At The Prewitt Group, we have risk management professionals for all of your insurance needs. We are here to answer all of your questions and help put your mind at ease, as we sustain our brand promise, The Power to Mitigate Risk.