Everybody wants to obtain cheap insurance rates and most people commit the mistake on jumping up into it too soon without even thinking that there may be a catch. Universal life insurance is considered by others as the best bargain that policy buyers can ever have. But how true is this is? What is it all about in the first place? How different is it from whole life? You can have these questions and more answered below. This article will walk you through the ins and outs of this type of permanent life insurance policy. 

• What is universal life in a nutshell? –as a permanent policy, it is intended to be kept for quite a long time.  The coverage will last as long as you pay the premiums. It also accrues cash value overtime. It has a couple of components, which are life insurance and savings. Your payment for both the premiums and the interest will be used for the insurance cost and other necessary charges such as annual fees. You have the option to withdraw the money monthly but of course, the amount will not be substantial. Most people do not withdraw it unless in emergency situation.

• Is it the same with universal term and variable universal? –the rates of universal life and variable universal are different with universal term life insurance quote. This is because these three are not the same unlike most people think. Universal term will require you to pay for minimum premiums which will not increase for a certain period of time, say for 20 years. However, the plan will lapse in the long run if that is the case like a term life. There are special reason when to opt for this kind of universal life plan, like when the insured lost his job and he could not afford to pay for higher premiums temporarily. 

Variable universal, on the other hand, is also a different policy. This one has something to do with investing in stock market. You would need the services of a life insurance broker or agent which has the license to deal with general securities if you will opt for this policy. More often than not, insurance firms only offer fixed universal life. But those with internal brokerage can market variable universal plan. Unlike its counterpart, you cannot withdraw money with the variable type but the death benefit will be given to the beneficiary.

• What are the features of universal life? –like life insurance no medical, universal life has its own features that are sufficient to draw the attention of prospective plan holders. In fact, some of the attributes of term and whole life are infused with universal life. Below are some of them. 

1. The policy holder can be certain of the accumulation of cash value as long as he is paying the premiums religiously. This is because it has a savings component unlike other types of life insurance plans.
2. It allows you to make the necessary changes not just to the premium but the face value of the life insurance policy as well. However, your insurability will have to be reassessed by your insurance firm before it can be increased.
3. Just like the term life, you can also expand the coverage of your fixed universal life. Doing so is optional and would depend solely in your own discretion. There are quite a few types of riders that you can incorporate to your plan.
4. It is way too cheaper and yet the coverage can be similar to that of whole life.

• How different is it from whole life insurance? –One stark difference of the two is that universal life has an interest rate aside from the face value of the insurance. These two makes up for the projected premium. If it will not come about, the insured can still be certain that the amount will be guaranteed until he dies. However, he could possibly lose the cash value. Another option is to increase the premiums if the cash value wants to be kept. With whole life insurance, you can also borrow money and pay it back afterward but it will not allow you to withdraw even a small amount every month. 

Depending on your special needs, universal life can be the best bargain you can have in terms of life insurance plans. Weigh down your needs and other things you need to consider and determine if you can take up a universal life policy. 

Article by David Livingston of EQuote, who is also a specialist in financial planning. For more information on quotes life insurance and life insurance no medical, visit his site today.