Life Insurance Learning Center - Term Life Insurance Types
Universal Term Life Insurance
Part 2 of this Life Insurance Company Policy Type
The flexibility factor involves the premium and death benefit. The policy owner has the ability to either increase or decrease the premium, but it must be in accordance with the life insurance company. Why would someone change the premium? Sometimes, perhaps extra cash is needed during a month, and the full premiums cannot be made. However, changing the premiums can either speed up or slow down the cash value growth, and it can even ultimately decrease it. So be careful when changing the amount of your premium around.
The death benefit can also be increased or decreased, but it also must be in accordance with the life insurance company. Altering the death benefit has effects on the rate of growth of the cash value. Sometimes, if the death benefit is increased dramatically, the life insurance company will request that the insured re-qualify for the universal life insurance by providing evidence of insurability.
Therefore, if you don't want a life insurance company to make you re-qualify due to onset health problems or change of job to something more dangerous, we recommend that you don't do any marked increases in the death benefit of your policy.
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