Universal Life Insurance Premium Payments Indiana IN

Reader’s Question:

I’m interested to get a universal life plan, but I don’t want to pay forever. What are my options regarding payment schemes for universal life policies?

Fred

Indianapolis, IN

I see that the universal life bug has caught on in Indiana, too. Well, basically, there are three types of payments you can opt for with your universal life policy.

Your first option is the Single Premium mode of payment. With this mode of payment, you will pay a single but substantial initial payment. Your policy will remain in force as long as cost of insurance does not zero out the account.

Then we have the Fixed Premium. This is where you make periodic payments like annually, semi-annually or quarterly, for a period of time like ten years or fifteen years. There have been cases, however, that when the policy has been paid up, the performance of the life plan got to the point that the original stipulations are not applicable anymore. So, you may have to choose to terminate the contract, make additional payments to keep the death benefit level, or you will have to lower the death benefit. Well, this is only for cases where your investments have gone awry. You have power to decide on your investment portfolio, you know.

And lastly, you have a Flexible Premium payment mode. This type of payment will allow you to determine how much premium you want to pay at each premium due date. What a lot of policy holders do is they make a large initial payment and then make irregular payments thereafter, so as to have a substantial death benefit coverage immediately.

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