What Are Normal Universal Life Insurance Rates?

Posted on Tuesday, October 27, 2009
Filed under Universal Life Insurance Rates

In today’s day and age, where our needs are continuously increasing and so are our expenses, it is important that we make a saving for our future or for our loved ones in the event of our death. Most people consider life insurance policies as the best way of saving for the future. There are several kinds of life insurance policies that people can choose from, depending on their needs and their ability to pay the premiums. Universal Life Insurance policy is one such policy that is regarded as a wonderful saving vehicle, as it offers flexible options to the policyholder.

As Universal Life Insurance policy offer flexibility in the way premiums are paid towards the policy, which is divided into two different accounts, one for the insured sum and the other for a cash value accumulation, this policy is far more preferred than the other life insurance policies. It is similar to Whole Life Insurance policy as far as its term is concerned, as they are both lifelong policies, however they have their differences. These are noticed in their interest quotes that are totally different in nature, setting them apart as two different policies altogether.

While the interest rates of the former grow on a steady basis, the rates of the Universal Life Insurance policy are mostly dependent on the Company’s growth. This means that the rates can slide both ways. If the company shows a gain the interest rates are increased, but if the company shows a loss, the interest rates are reduced. However this rate does not go below the guaranteed standard rate applicable in the policy, which today is between 3-4%. More details to the guaranteed rate offered can be found if you go through the terms of the policy in the policy papers that the company issues to you when you take up a policy.